NASDAQ futures are coming into Thursday with a slight gap up after an overnight session featuring extreme range and volume. Price was all over the place overnight—until about 5am New York the market chopped around the inside of Wednesday’s range before driving lower in the early A.M. hours. That selling nearly took out our recent swing low (set on 08/05) before discovering a strong responsive bid around 7am, just after Walmart and Alibaba both posted strong earnings data. The second wave after the responsive buying took price up through the Wednesday midpoint briefly before we settled into another choppy balance. At8:30am advance retail sales data from the US Government (likely less of an indication of the health of the retail market than WMT earnings) came out stronger-than-expected. As we approach cash open, price is bouncing around the lower quadrant of Wednesday’s range.
Also on the economic calendar today we have NAHB housing market index and business inventories at 10am then long-term TIC flows at 4pm.
Major chip marker NVIDIA is set to report earnings after the bell.
Yesterday we printed a double distribution trend down. The day began with a gap down to the low-end of Tuesday’s P-shaped (short-squeeze) profile. After a brief two-way auction, sellers stepped in and began to campaign price lower, breaking down through Monday’s low in a steady decent lower. Just after New York lunch, and right near the weekly ATR lower band, responsive buyers stepped in and we came into balance. Late in the session sellers took price down through low-of-day and closed the session out on the lows.
Heading into today my primary expectation is for buyers to press up through overnight high 7572.75 to set up a move to tag the 7600 century mark before two way trade ensues.
Hypo 2 stronger buyers press up to 7640.25 before two way trade ensues.
Hypo 3 sellers probe down into the Walmart/Alibaba reaction, eventually trading down through overnight low 7388.25 and closing the gap left down at 7380.75 before two way trade ensues.
Volume profiles, gaps, and measured moves: