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Tag Archives: $NDX

Gap Hunter

Nasdaq futures are up a touch as we head into cash open. The index spent most of the evening trading up following yesterday’s strong reactive buying. Range overnight managed to press 2nd sigma while volume stayed compressed into its normal range.

On the economic calendar we saw Advance Retail Sales at 8:30am which solicited a choppy but ultimately sideway reaction. We also have Business Inventories at 10am and Crude/Distillate Inventories at 10:30am.

Going back to the charts, yesterday we opened pro gap down and drove lower from the opening bell. The range was enough to expand volatility for a third week. It also managed to fill last Thursday’s pre NFP gap. The auction ultimately stalled out and found responsive buyers. We then worked higher to close the overnight gap up to 4431. A few attempts were made to reenter Monday’s range but ultimately we traded lower into the bell as the market was tasked with absorbing a heavy amount of supply in the final hour and a half of trade.

Heading into today, we are priced to open on the high-end of yesterday’s range. My primary expectation is for seller to push into the overnight inventory and trade down to 4420.50 to close the overnight gap. This market has demonstrated a strong proclivity to close gaps lately so it might as well continue doing so. From there sellers may continue pushing to 4416 where I will look for signs of buyers and then two way trade ensues.

Hypo 2 buyers push off the open to take out overnight high 4447.75 to target 4455.50 where sellers come in and two way trade ensues.

Hypo 3 buyers take out 4455.50-4457.75 and continue higher to target the open gap up at 4476.25.

Hypo 4 breakdown below 4416.25-4412 opening us up to trade down to 4395.50.



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Down The Slip Stream

Nasdaq futures are pro gap down this morning. The action took us to second sigma range and volume, and effectively erased the entire pop from Nonfarm payroll only two sessions back.

The profile was thin, single prints, and created the scene for a fast move. The fact it was traversed overnight may be a positive. This occurred while none of the underlying components were trading. Therefore, it will be the responsibility of the market to balance itself back in line with its components come open.

Perhaps contributing to the selling was Fed’s Williams who, for whatever reason, went on CNBC yesterday evening and said “Every FOMC meeting is on the table for a rate hike.”

Heading into today, the only economic event of note is the Monthly Budget Statement at 2pm.

Yesterday we printed a normal variation down day and closed on session low after briefly taking out Friday’s high in the morning. Heading into today my primary expectation is for buyers to push into this overnight inventory and trade up to 4408. From there I expect supply to come in and us to continue trading lower to work toward 4367.50.

Hypo 2 buyers blow up through 4408 and push us back up to 4433.

Hypo 3 sellers gap-and-go lower, take out 4367.50 early and target 4357.50. Levels:


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In The Groove

Nasdaq futures are trading quietly ahead of this week’s start. After two Monday’s of starting out with a big gap up and volume elevated, today is set to open near-flat on volume low-end normal.

The economic calendar is quiet today. At 10am we’ll hear the latest read of the Labor Market Conditions Index. This is a low/medium impact number. Earning’s season is moving onto b-role companies and less likely to impact the overall market. The dominating headline risk remains with the eurozone and their Greek situation.

Friday price went pro gap up after Nonfarm payroll data received a positive reaction. We spent the rest of the session trading sideways with a slight upward bias. Since then, during globex, price managed to test below Friday’s low briefly before rotating 10 points higher.

Heading into today, my primary expectation is for 2-way auction to give way to more price discovery up. Buyers look to target a 05/04 gap fill up to 4476.25.

Hypo 2 is sellers take out overnight low setting up a test of the single prints down at 4437. If they can push down into them, look for a give-back of the NFP boost all the way down to 4403.25.

Hypo 3 is bracket trade between 4456 and 4445.



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The Pole Climb

Nasdaq futures are steaming higher premarket. Price was up nearly 10 handles on the session ahead of the Nonfarm Payroll data and continued higher after. The big surprise in the data was the 85k revision to last month’s figure making it that much worse—perhaps easing investors’ concern The Fed will raise short term interest rates soon. A big bounce in construction helped today’s number. Overall the news was interpreted as positive.

Also on the docket today is the Baker Hughes Rig count at 1pm.

Big moves tend to occur where market profile shows a thin history. We call these areas zippers or single prints. In the instances where a large set of single prints is above, I like to think of it like a pole or rope. I was discussing this feature yesterday on twitter, and you can still slightly see it, though it has been partially filled in. See below:


Heading into today, my primary expectation is for sellers to work into the reaction move and test down to 4433 before finding buyers and choppy, two way trade ensues.

Hypo 2 is a gap and go higher, a strong surge at the open morphs into a slow grind up to 4474. If sellers no show here then we continue to 4491.25.

Hypo 3 is return to NFP “crime scene” 4412 and two way trade enses.

Hypo 4 blow through pre NFP mark 4412 and test the lower balance at 4400.

Levels are pictured above.

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Big Session Overnight

Nasdaq futures went for a ride overnight. On the session price printed over a 40 point range on abnormal volume. Most of the session was dominated by buyers until after 5am when sellers showed up inside the 04/07 range.

At 8:30am intial/continuing jobless claims data was out and has seen price lower slightly. Also up on the docket today is Natural Gas storage figures at 10:30am and Consumer Credit at 3pm. The big data is out tomorrow morning when we here the monthly change in NonFarm Payroll.

Yesterday sellers pushed off the open to take out Tuesday’s low early on and sellers continued pushed for most of the session. Comments from Fed Chair Yellen about equity valuations being high may have spooked investors. By early afternoon we closed the open gap dating back to 4/17. Toward the end of the day we saw a ramp higher.

Heading into today my primary expectation is for sellers to push into the early morning globex inventory to 4349.75 before buyers step in and work us higher. Look for buyers to take out overnight high 4379.

Hypo 2 sellers take out overnight low 4332.50 to target 4310 before buyers step in and 2-way trade ensues.

Hypo 3, buyers push off the open to target 4390 before sellers come in and two way trade comes in.

Hypo 4 strong rally up through 4396 sets up a secondary push to 4432.


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Slippery Location To Start The Session

The Nasdaq is trading lower premarket. A few attempts were made to push price higher and each was met with quick reversal, suggesting the early perception of these prices is one of excess.

Trade Balance data was out at 8:30am and served to accelerate the index selling to session low. Also on the agenda today is the ISM Non-Manufacturing index at 10am.

Yesterday we opened gap up and had a strong early drive into last Wednesday’s range before finding sellers. We then spent the rest of the session rotating lower, not quite filling the overnight gap. Sellers did manage to close the range gap however, which likely gave sellers confidence to hold overnight.

Heading into today, my primary expectation is for sellers to continue pushing off the open. Look for buyers around 4450 but if they no show then liquidation down to 4435.50.

Hypo 2 buyers push into the overnight inventory to test up through to 4470 where sellers defend and two-way trade ensues.

Hypo 3 buyers push a full gap fill up to 4476.25 and set up a secondary leg higher to 4490.75. If buyers can take out this level the weak high at 4503.50 becomes a target.

Hypo 4 gap and go drive down, take out 4435 and continue to test 4420.


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Morning Nasdaq Report

Nasdaq futures are set to gap up as we head into a fresh week. Volume is running normal and range is elevated a bit above normal, but overall it was an orderly auction. Price managed to push down into the upper quad of Friday’s range before finding buyers who worked up into last Wednesday’s value.

Heading into today the economic calendar is quiet. At 10am month-over-month Factory Orders are out, a medium impact number. However, most of the weight will be on Friday’s Non-Farm Payroll data, with Wednesday’s ADP employment change and Thursday’s Initial/Continuing jobless claims serving as appetizers.

Last week the Nasdaq managed to make a new contract high on Monday before rolling over and spending most of the week trading lower. It wasn’t until late Thursday afternoon that buyers emerged with enough conviction to entice initiative buyers onto the tape.

Heading into today, my primary expectation is for buyer to push a bit higher, but stall out around 4484.50-4490. I will look for sellers to close the overnight gap down to 4467.50. If buyers aren’t found here then continue lower to test below overnight low 4457. This could lead to an acceleration, especially if we trade below 4445.

Hypo 2 buyers push up through 4490 and grind higher to target 4517.

Hypo 3 we chop and build value between 4489 and 4457.


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New Month, Radical Change in Behavior

After nearly two weeks of globex volume running hot, last night comes around, and the action is completely benign. Nasdaq futures are up overnight on a range that’s high-end normal on low volume.

There’s a news dump at 10am, including ISM Manufacturing, Construction Spending, ISM Prices Paid, and University of Michigan’s final Confidence read for April.

Yesterday most closely resembled a trend day down. It may constitute a triple-distribution trend day, if such a name existed. Toward the end of the session buyers came in, about halfway into the 4/20 range. If you recall, 4/20 was two Mondays ago, and we started with a gap up and ran all day—in essence it was a conviction day.

So we have two combating forces here which will tell the major story going into the weekend. Market Profile theory states that any entry in the direction of the trend on a trend day is a risk-free entry into the following session, meaning, we are likely to at least go one tick below the trend day low in the following session. The other force is the proclivity of a conviction day to be defended.

Heading into today, my primary expectation is for a choppy open until we hear the economic data points at 10am. After, I will look for sellers to push into the overnight (and late-yesterday afternoon) inventory and test their conviction. If sellers can trade below 4409 I will look for them to test yesterday’s low 4386.50.

Hypo 2 is we muddle around north of 4400 in choppy, two-way, Friday trade.

Hypo 3 is we gap-and-go, demonstrating some v-shape tendencies. Look for responsive selling up at 4452.

Hypo 4 is we test higher early on, to 4432, then reverse and continue working lower to test Thursday low 4386.50. If liquidation takes hold look for a gap fill down to 4349.50.



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Longs Were Liquidated Overnight

Nasdaq futures are lower overnight. Sellers managed to extend the range just a touch beyond first sigma, doing so on normal volume.

The first thing that jumped out this morning was the overnight profile structure, a lovely lowercase-b check it out:


It was even more pronounced before the 8:30am data. This type of profile suggests a long liquidation took place. A long liquidation is a temporary phenomenon where order flow is created by stops being run. This type of print, in the context of a bigger uptrend, tends to occur at-or-near the inflection point—a welcoming development on the weak week.

Heading into today, my primary expectation is for buyers to fill the overnight gap, pushing trade up to 4478.75. From there we will see if they can take out the overnight high just above at 4479.50. Overall I’m looking for sellers to defend the region from 4485-4490 and two way trade to ensue.

Hypo 2 is buyers push through 4490 and sustain trade above it to set up a leg higher to target Tuesday’s gap up to 4515.50.

Hypo 3 is sellers continue working lower, take out overnight low 4452. Look for responsive buyers at 4442.50 then 4433.

Levels are pictured above.

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Weak GDP Pushes Nasdaq into Pro Gap Territory

Nasdaq futures are lower overnight on a slightly elevated range but normal volume. Price drifted lower for much of the night session and the selling accelerated after the GDP data came out much weaker than expected.

Heading into today, we are on the cusp of a pro gap. However, due to the large range printed yesterday, we are still set to open inside prior day range.

Yesterday we saw Monday’s selling accelerate down into the Thursday/Friday gap and fill it before finding a strong responsive buyer. Once found we spent the rest of the morning trading higher before fizzling out about half way into Monday’s range.

On the agenda today we have Pending Home Sales at 10am, Crude Oil inventory at 10:30am, and the FOMC rate decision at 2pm.

My primary expectation this morning is for buyers to push into the overnight inventory. If they can push through 4500 then look for a gap fill up to 4515.50 before we quiet down and wait for the FOMC.

Hypo 2 sellers drive down off the open to test yesterday’s low 4471.75 and if they break through look to test 4459 and if that cannot hold then a liquidation trade may take hold.



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