NASDAQ futures are coming into Wednesday gap down after an overnight session featuring elevated range and volume. Price worked lower all night after our authoritarian leader took a hard, nuclear stance against the petulant nation of North Korea. Price worked down near last week’s lows, but has not yet breached them.
The economic calendar is light today but crude oil inventory at 10:30am may carry more weight considering we may be headed to war. There’s also a 10-year Note auction at 1pm. It will be interesting to see how that government debt is received with nukes being so casually discussed.
Yesterday we printed a neutral extreme down. The day began with a gap down that was quickly bought up. Buyers continued to initiate risk, pressing well-up-into the hard selling back on 7/27. Then, the bids dried up, and we reversed the entire day’s range, making a new session low, pushing us neutral, then closing near low-of-day, earning the extreme designation.
Heading into today my primary expectation is for a gap-and-go lower. Look for buyers down at 5841 and two way trade to ensue.
Hypo 2, a return to the ‘scene of the crime’. Buyers press into the overnight inventory and work up through overnight high 5919.25. They continue higher, up to 5938 to see if sellers meant business yesterday.
Hypo 3 stronger sellers press down to 5805.25 before two way trade ensues.
Levels:
Volume profiles, gaps, and measured moves:
