Nasdaq futures are pricing a gap down heading into cash open Tuesday. The globex session started out strong after news that Google will restructure their organization sent share prices soaring. After briefly taking out Monday’s session high, Nasdaq price rolled over and traversed the entire range. We are near session lows on slightly elevated range and volume.
The economic calendar is quiet today. At 10:00am we will hear Wholesale Inventories.
We started the week with a sizable gap up. Buyers showed up at the open and drove price higher but even before lunchtime we could see active responsive selling on the tape. Bulls briefly managed to turn initiative and extend price higher, right up into the weekly ATR bracket before sellers again faded prices.
The S&P 500 led the way Monday and overall breadth was decent. If the S&P continues to show relative strength it would be an overall positive for the market.
Heading into today, my primary expectation is for sellers to push lower from the gap down. Look for a move to close the weekend gap at 4520. This area will be pivotal, but I expect sellers to continue pushing below it and work down to target the 4500 century mark. Look for responsive buyers from 4496 – 4484.75.
Hypo 2 buyers push into the overnight inventory and work the overnight gap fill up to 4565.75. There is a strong VPOC here that quite easily could behave as a magnet. Look for sellers to defend at 4572 and price to roll back over.
Hypo 3 buyers push up through 4572 and work toward hitting the 4600 century mark.
Hypo 4, full on liquidation. Sellers push down through 4500 early setting up a test of last Friday’s low. Target 4468 with a stretch target of 4462.25.
Levels:
remind me what the ATR brackets are please, Raul? Thx.
the average true range of the daily chart applied both directions to Friday’s closing print