NASDAQ futures are coming into Wednesday gap up after an overnight session featuring extreme range and volume. Price was balanced overnight until the increasingly popular 3:30am hour when buyers emerged and campaigned price up through the Tuesday high. They worked up into last Wednesday’s range before finding sellers who defended the curious support level from that day. As we approach cash open, price is hovering just above yesterday’s high.
On the economic calendar today we have crude oil inventories at 10:30am. At noon Fed Chairman Jay Powell is set to give testimony for his second day on Capitol Hill, today he will meet with the House Financial Services Panel. Then at 1pm we have a 20-year bond auction.
Yesterday we printed a normal variation down. The day began with a pro gap up, with open print being in a gap zone left behind last week Thursday. After a tight open two way auction sellers pressed into the overnight inventory and closed the overnight gap. Just a few points below the gap fill was a strong responsive bid and we formed a sharp excess low before pressing clean up through the daily midpoint. Price never went neutral though. Instead price churned above the midpoint for a few hours. Late in the session an attempt was made by sellers to press down through the mid, but they were ultimately thwarted during the ramping hour. We ended the day in the upper quadrant of range.
Heading into today my primary expectation is for sellers to work into the overnight inventory and reclaim Tuesday’s high 10,001.75 early on, setting up a gap fill down to 9959. From here we continue lower, down through overnight low 9916.25. Look for buyers down at 9890.25 and two way trade to ensue.
Hypo 2 gap-and-go higher, trading up through overnight high 10,038.75 on our way to a gap fill up to 10,083.50 before two-way trade ensues.
Hypo 3 stronger buyers trade up through all time high 10,155.50 and explore open air.
Levels:
Volume profiles, gaps and measured moves:
