NASDAQ futures are coming into the second-to-last Monday in August gap up after an overnight session featuring elevated range and volume. Price steadily ascended higher until about 10:30pm New York, gradually trading up near (but not exceeding) all-time-highs. Since then price has balanced up near last week’s high and as we approach cash open price is hovering right along it.
On the economic calendar today we have PMI composite flash at 9:45am followed by existing home sales at 10am.
Last week featured weakness early Monday which discovered a strong responsive bid and sent markets rallying hard into Monday’s close. Gap down Tuesday reversed much of the Monday gains followed by selling pressure through Thursday morning. Strong bidders reversed the auction Thursday morning and rallied price nearly back to unchanged by week’s end. The Russell 2000 was significantly weaker that the other major indices.
The last week performance of each major index is shown below:
On Friday the NASDAQ printed a normal variation up. The day began with a slight gap up inside Thursday range. Buyers stepped in after a brief open-two-way auction in range sending price up through the Thursday high before the overnight gap could be filled. Price worked up near the Monday open gap but did not exceed it before sellers stepped in and worked price back down to the daily midpoint. Buyers defended the mid and we bounced away from it, flagged along the daily high for a bit and then rallied back up to the high by end-0f-day.
Heading into today my primary expectation is for buyers to reject a move back into Friday high 15,098 setting up a move up through overnight high 15,153.50. Look for sellers up at 15,161 and for two way trade to ensue.
Hypo 2 stronger buyers take out all time high 15,172.25 on their way to tagging 15,200.
Hypo 3 sellers work down through overnight inventory and close the gap to 15,091.75 setting up a move down to 15,040.50.
Levels:
Volume profiles, gaps and measured moves:
