NASDAQ futures are coming into Friday with a slight gap down after an overnight session featuring extreme range on elevated volume. Price was balanced overnight, chopping along the upper half of Thursday’s range. Several times price came close to taking out the Thursday high but didn’t exceed it. This formed a weak high heading into nonfarm payroll data. At 8:30am NFP data came out well below expectations:
USA Nonfarm Payrolls for Mar (701K) vs (100K) Est; Prior 273K
USA Unemployment Rate for Mar 4.4% vs 3.8 Est; Prior 3.5%
Since then price has been stable, despite the soft data. As we approach cash open, price is hovering above Thursday’s midpoint.
Also on the economic calendar today we have ISM non-manufacturing data at 10am.
Yesterday we printed a normal variation up. The day began with a flat but only because futures were moving fast ahead of the bell. A few minutes prior to the open we were gap up by about 50 handles. Sellers worked this gap fill before the open and once opening bell hit we saw a buying drive higher. Sellers stepped in ahead of Wednesday’s midpoitn and reversed the open drive up but said sellers could not take out overnight low. Instead price ripped higher again, making new higher of day and then holding a tight flag through New York lunch. Sellers were active again in the afternoon but their efforts were again thwarted. Another rip took price near the overnight high by end of day, and we closed near the highs, but never actually fulfilled the overnight stat.
Heading into today my primary expectation is for buyers to work into the overnight inventory and close the gap up to 7629.50. From here we continue higher, up through overnight high 7651.50 on our way to tagging the composite VPOC at 7700 before two way trade ensues.
Hypo 2 stronger buyers rally price up through 7700 and tag 7743 before two way trade ensues.
Hypo 3 sellers press down through overnight low 7509.50 setting up a move down to 7359 before two way trade ensues.
Volume profiles, gaps and measured moves: