Nasdaq futures are heading into the week balanced and compressed. The overnight session has so far been a narrow (but normal) range on normal volume. The economic calendar is light this week and today in particular only has one low impact release—at 10 am the Labor Market Conditions Change.
Aside from headline risk, that essentially leaves the market to its own device.
Last week we came in ambitious, gap up, and quickly eroded the gap to kick off 3 days of chop. Toward the end of the week sellers worked us lower until we found a sharp responsive bid Friday morning. We closed out the week grinding sideways.
Interesting to note, last week Monday we printed a normal day—we haven’t seen this print in quite some time. It suggests strong OTF presence early in the session, but no conviction follow through afterwards. The footprint it left behind suggests higher time frame selling that was absorbed well for much of last week.
Heading into today, my primary expectation is for buyers to work the market higher. Look for an early move to take out overnight high 4483.25 followed by a gap fill trade up to 4497.50 with 4508.25 as an upside target.
Hypo 2 buyers push up to 4497.50 then stall out and two way trade ensues with a range of about 4500 to 4473.
Hypo 3 sellers work lower, take out overnight low 4468.75 and test below Friday’s low 4449.25.
Levels:
working hypo 3 for now