NASDAQ futures are coming into Monday gap down after an overnight session featuring normal range on elevated volume. Price drifted lower overnight after briefly trading up beyond last week’s high. As we approach cash open, price is hovering a few point below Friday’s midpoint.
On the economic calendar today we have 13- and 26-week T-bill auctions at 11:30am followed by 2-year FRN and 3-year Note auctions at 1pm.
Last week kicked off with a slight gap down then a fast drive lower. The drive erased all of the pre-Thanksgiving rally before catching a bid and slowly rotating back near the midpoint. Tuesday featured a strong gap down and early on it looked as if we may take out November lows. However a responsive bid stepped in and droev price higher, ending the session just below the Monday low. Wednesday gap up which was consolidated (sideways) though Thursday, and by Friday afternoon, after a gap up and slow rotation higher, we were right where we started the week off. The Russell, a bit higher. The last week performance of each major index is shown below:
On Friday the NASDAQ printed a double distribution trend up. The day began with a gap up and small drive higher. The move consolidated sideways for a few hours before buyers reasserted themselves, eventually trading a few ticks below the weekly high before ending the week near session high.
Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 8400 then look for a continued move higher, up through overnight high 8415 before two way trade ensues.
Hypo 2 stronger buyers press up to 8440.50 before two way trade ensues.
Hypo 3 sellers work down through overnight low 8380.50 and continue lower, trading down to 8326 before two way trade ensues.
Volume profiles, gaps, and measured moves:
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