NASDAQ futures are coming into Wednesday gap down about -150 after an overnight session featuring extreme range and volume. Price fell down through the Tuesday midpoint around 9:30pm and then consolidated until about 3am. The 3am hour has been dominated by sellers the last month-or-so. Around 3am sellers pressed down through the Tuesday low and down into the lower quadrant of Monday’s range. Then around 6am New York bidders stabilized the selling. Then around 7am the auction reversed higher. At 8:15am adp employment forecast came out well above expectations, and as we approach cash open price is hovering back inside the lower quadrant of Tuesday’s range.
Also on the economic calendar today we have crude oil inventories at 10:30am.
Yesterday we printed a double distribution trend up. The day began with a slight gap up in range. Buyers drove higher shortly after an open test. Sellers made an attempt shortly after to gap fill but failed and then a steady buying/accumulation campaign took hold. Said buying continued until about 11:30am. Then after several hours of balance/consolidation buyers made another push higher but stalled around 3:30pm before closing the weekend gap. Instead we saw quick selling into the close. We ended the session above the mid.
Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 14,660. From here buyers continue higher, trading up through overnight high 14,674.75. Look for sellers up at 14,700 and for two way trade to ensue.
Hypo 2 sellers reject out of Tuesday low 14,497.50 early on setting up a move down through overnight low 14,422.50. Look for buyers down at 14,388.25 and for two way trade to ensue.
Hypo 3 full-on liquidation lower. Sellers take out Monday low 14,367.75 early on setting up a gap fill down to 14,324. Stretch targets 14,300 and then 14,272.25.
Volume profiles, gaps and measured moves:
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