Nasdaq futures are flat headed into Tuesday. The overnight session was normal—normal range and volume. Price managed to briefly push below yesterday’s session low before finding buyers and heading back into a well-established balance zone. At 8:30am the Advanced Retail Sales came in a bit below expectations. The initial reaction is buying.]
Also on the economic calendar today we have Industrial/Manufacturing Production at 9:15am and Business Inventories at 10am. These early events ought to lend a certain choppiness to opening trade.
Yesterday we came into the week with a decent size gap up [not quite pro gap] and sellers quickly faded it. The opening swing was an open test drive down. Sellers managed to push the range extension but not much initiative selling was seen. Instead we formed the classic long liquidation b-shaped profile.
Heading into today however, my primary expectation is for sellers to continue probing lower. Look for sellers to work down and target the overnight low 4280. This opens the market up for a move down to 4258. Look for responsive buyers here and two way trade ensues.
Hypo 2 bulls push up into yesterday’s single prints and work us higher. Look or a new weekly high and responsive sellers up at 4333 putting us into 2-way trade.
Hypo 3 churn between 4307.50 and 4288.75 which ultimately gives way to a break of overnight high 4314 but barely before we resume the churn.
In essence, not expecting much directional movement ahead of Thursday’s FOMC rate decision. Levels:
I’m inclined to think it is setting up for a “buy the rumor, sell the news” moment and I look for cash N100 to hit 4364 or close to it.
bang on old sport
Alas, I called cash, not futures. Looks like a 9 point differential. I hope it stays flat, buying some puts tomorrow. I’d love to see a face-ripping-off bear market rally…that would be a put buying opportunity of high confidence.