NASDAQ futures are coming into Thursday gap down after an overnight session featuring elevated range on extreme volume. Price poked 4 points above the Wednesday cash high before coming into balance in the upper quad of Wednesday’s trend day. As we approach cash open price is hovering below 6900 in the middle of a microbalance. At 8:30am initial/continuing jobless claims data came out worse than expected.
Also on the economic calendar today we have pending home sales at 10am, 3-, 6-, and 52-week T-bill auctions at 11am, Fed speak from two members at 2pm alongside the 2pm Fed release of minutes from their last meeting, and Fed balance sheet at 4:30p.
Yesterday we printed a trend day. The day began with a gap up out of range and slight drift lower. Buyers rejected an attempt to trade back into the Tuesday range and as we went into the Jerome Powell talk at 11am price was compressed into a coil. Something the Fed chairman said shot prices higher which set off a trend up to the huge microcomposite value area low at 6800. Price soon traveled beyond 6800 and sustained trade inside the big value, setting up a move to traverse the entire value and tag the top around 6900. We closed pretty much at session high.
The only caveat is value never shifted higher from where it was set during the morning coil. The daily VPOC still resides down at 6735.50.
Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 6923.50. From here we continue higher, up to the composite VPOC at 6950 before two way trade ensues.
Hypo 2 sellers gap-and-go lower, take out overnight low 6866 and sustain trade below LVN at 6860.50 setting up a move down to 6800 before two way trade ensues.
Hypo 3 stronger sellers erase the entire Powell rally, trade us back down to the ‘scene of the crime’ at 6750. We tag the Wedneday NVPOC at 6735.50 before two way trade ensues.
Volume profiles, gaps, and measured moves:
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