NASDAQ futures are coming into Monday gap up after an overnight session featuring extreme range and volume. Price worked higher overnight, first spiking upward shortly after Globex trade began 6pm Sunday, then making a secondary rotation higher around 5am. The second rotation saw price briefly probe above the Friday high. As we approach cash open, prices are hovering right around last Friday’ high. At 8:30am personal income/spending data came out in-line with expectations.
Also on the economic calendar today we have a 3- and 6-month T-bill auction at 11:30am.
Last week began with a slight gap up and choppy Monday. Tuesday saw a big gap down, away from value which drove lower early on before finding a responsive bid. The rest of Tuesday was spent rallying but Wednesday erased those gains during a trend down. Wednesday was spent reversing much of Tuesday’s losses but then Amazon and Google earnings after the bell spiked price lower. Friday was choppy. In sum, chopping week, lots of big moves in both directions.
On Friday the NASDAQ printed a neutral day. The day began with a gap down-to-near the weekly low. Buyers drove higher off the open but were quickly overrun, pushing the market range extension down. Selling dried up shortly after the first hour and we reversed, pressing back up through the daily range to go neutral then tagging the Thursday naked VPOC. Sellers stepped back in and we chopped into the bell, eventually closing slightly above the daily midpoint.
Heading into today my primary expectation is for sellers to work into the overnight inventory and work a half gap down to 6930.50. Buyers step in here and work up through overnight high 6991.50 to tag 7000. Look for sellers up at 7023.25 and two way trade to ensue.
Hypo 2 sellers work a full gap fill down to 6893.50 then continue down through overnight low 6882.75. Look for buyers down at 6800 and two way trade to ensue.
Hypo 3 buyers gap-and-go higher, up through 7023.25 and sustain trade above it setting up a move to target 7088.
Volume profiles, gaps, and measured moves:
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