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Nasdaq futures are starting the week flat after rallying last week. The overnight session printed normal volume and range but did manage to take out Friday’s session low a few times before bouncing back to unchanged.

The economic calendar is quiet stateside today with Existing Home Sales at 10am as well as Fed’s Williams talking economic outlook. At 1:15pm attention will be on the European Union where Chancellor Merkel is meeting with Greek Prime Minister Tsipras for talks on Greece. They are meeting in Berlin.

Turning our attention to the charts we can see how the Nasdaq went gap up through a prior well-established value area. Price worked higher for much of Friday’s session before finding responsive sellers 1-tick ahead of closing the gap dating back to March 1st at 4472.50.

4444 serves as a helpful pivot point especially if sellers decide to work into the below gap zone today. Please see below:

Heading into today, my primary expectation is for an open auction inside Friday’s range followed by a push higher to target overnight high 4461.25. If buyers sustain trade above 4459 then look for a push to new swing high 4477.

Hypo 2 is sellers contain trade below 4448.25 and work down into the gap zone below to target overnight low 4439, Thursday’s range gap 4432.50 and a full gap fill to 4424.50. The ultimate target of this hypo is tagging the NVPOC at 4422.25.

Hypo 3 is aggressive selling takes us down through the NVPOC at 4417 and begins working down into the Fed rally. Look for signs of responsive buying down at 4400 but be cautious of a full take back down to 4355.25.

I have highlighted key market profile zones below:


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Happy OPEX Day

Nasdaq futures are up sharply as we head into monthly/quarterly option expiration day. No news appears to be behind this overnight action (correct me if I’m overlooking something) and heading into cash open we are working with a pro gap.

The economic calendar is quiet today. There are two Fed heads speaking—Lockhart at 10:20am in Georgia and Evans in Washington. Energy traders will likely be closely watching the Baker Hughes Rig Count at 1pm as well.

Yesterday the Nasdasq printed a normal variation with a range extension down. Overall a quiet, balancing session in the upper quad of Wednesday’s Fed day move. Once the cash session ended however prices began trading 1-time frame up.

Heading into today, my primary expectation is for buyers to build off their overnight progress by attempting a gap and go. To succeed in doing so, they will need to sustain trade above the very prevalent mCLVN at 4459. If they do, then look for a push to target the open gap up at 4472.50.

Hypo 2 is sellers defend the mCLVN at 4459 and begin working into the overnight inventory. In that case, look for swift action back down to 4437 area and a potential full gap fill down to 4424.50.

Hypo 3 is a big gap up and then sideways grind to wear out any intraday theta on options.

These levels are highlighted below:


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Zipper Context

I spent the morning updating my charts and stats to the current market conditions and the result is overwhelmingly neutral. Nasdaq futures are trading lower on the globex session after taking out Wednesday’s session high by a few ticks. The range and volume are both on the high end of normal as traders actively debated the true value of this instrument.

At 8:30am Initial/Continuing Jobless claims data came out mixed and brought sellers in who made a new overnight low. At 10am Leading Indicators and Philadelphia Fed info will be released. At this time Fed’s Tarullo will also begins his testimony to the Senate. At 10:30am Natural Gas Storage data is out.

Turning to the charts, yesterday we printed a neutral-extreme profile print suggesting strong upward directional conviction. The major move up was news driven. Participants drove price higher after the release of the FOMC rate decision and commentary. In the wake of the move is a zipper or single prints which are vulnerable to fast selling. Should price trade down below 4400 it may setup a fast move back to 4350 to reassess the crime scene.

Conversely, there are a few price magnets just above our current prices. Just above overnight high (4435) there is a micro-composite volume point of control (mCVPOC) and a bit higher an open gap (4472.50). These areas may attract price and lead to a drift higher.

Thus, my primary expectation heading into today is for buyers to work into the overnight inventory to close the gap up to 4421.25. From here look for buyers to attempt to take out overnight high 4435 and target the MCVPOC at 4444.25.

Hypo 2 is buyers are unable to sustain trade above yesterday’s close 4421.25 and responsive sellers step in to push below overnight low 4412.75. Look for responsive buyers ahead of 4405 who stabilize the action and balanced, 2-way trade ensues.

Hypo 3 is sellers push down through 4400 and sustain trade below this level setting up a fast move down the zipper. Look for buyers at 4385 but ultimately they are run over on the way back to 4350.

These levels are highlighted below:


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Nothing Has Changed…YET

Geico-CamelsWhat if you had a large data set that said you suck at Wednesdays? It would give a whole new sting to hump day, wouldn’t it? For reasons unbeknownst to me (I have looked over the data with a comb) my will power breaks down and old bad habits creep in by Wednesday resulting in poor trading performance.

And that’s okay because will power is finite. These days I only take the highly qualified trades and only early on. Once my will muscles are stronger I will increase duration.

Nevertheless today is incredibly important in the grand scheme of things because today we make an earnest attempt to find a tradable low. Early this morning we had MBA Mortgage Applications which had a sell, buy, sell reaction affirming the sellers are still in short term control (the number was a bit better than expectations). At 10:30am we have oil/gas inventory stats and the market is working higher from VAL already, constructive. At 2pm we have a Monthly Budget Statement, and most importantly we have the results of the Fed’s Bank Stress tests after market close at 4:30pm.

The short term trend is seller dominated. It started Friday with a motivated move out of balance. Monday price drifted higher but found a sharp responsive seller (responsive relative to Monday’s open, initiative relative to the upper balance, VITAL you understand this). Then yesterday we had a pro gap down and completion-type wave which closed down near the low of the session.

Overnight prices drifted higher on normal volume and range but were unable to reclaim the lowest seller-defended area from yesterday at 4349.50.

Heading into today my primary expectation is for sellers to push into the overnight inventory and test below the overnight low 4330.75. Just below there at 4326.75 there is a wonderful NVPOC magnet. I will look for signs of responsive buyers here, otherwise we continue lower to test the 2/12 session low gap zone.

Hypo 2 is buyers hold above 4336 and we start working higher. Look for a move above 4349.50 and look for buyers to become initiative above 4353.

Hypo 3 is a quiet digestion of the selling with price holding yesterday’s low 4328.50 and reverting to quiet, two-way trade.

Levels are highlighted below:


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The Pros Have Formed a Gap

You won’t come to the Raul blog often and find my crying about wolves. I study the tape, like a psychopath stalker. Its nuances speak to me. We are waking up to a pro gap down this morning.

The overnight session managed to go second sigma range, something it has not done in quite some time. However, the volume behind the move was a bit less compelling. However there is still a half hour of globex to go.

The Greek situation is heating up in Europe where parties are growing frustrated with how much time is being wasted. Likely adding to European frustration is the quirky 3 week window where daylight savings throws them off with our time and markets. The economic calendar is otherwise quiet until tomorrow when we here about mortgage applications, oil inventories, and bank stress test results.

Yesterday we started the week quietly despite closing Friday out with a strong neutral extreme day. The up move in the Nasdaq occurred around 1pm and can be considered news driven, because it was closely associated with the Apple live event. However at the end of the session sellers began piling onto the bid.

The overnight session managed to pushed down through the micro balance we formed from 2/16 to 2/18 before finding responsive buyers. This zone has a compelling VPOC at 4382 which we are currently priced to open upon.

Heading into today, my primary expectation is for an open auction outside range due to this VPOC. Look for 4372.25 and 4389.50 to contain price early on. Look for buyers to work the range gap up to 4391.75 before finding responsive sellers (responsive relative to the open, initiative relative to Monday) who step in and leg us lower to target the NVPOC at 4360. That would be a big day

Hypo 2 is we gap and go lower to target the NVPOC at 4360 then the gap down to 4345.75 to retest prior swing high 4343.25.

Hypo 3 is a strong responsive buy full gap fill to 4414.75. It has happened a few times in recent history and requires some serious resources to do so, hence the Pro Gap nomenclature.



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Holding Up So Far

Nasdaq futures are indicating a gap up on the open after a session which mostly featured selling. In the wake of this normal range and volume session, participants left behind a somewhat weak looking low at 4396.25.

The economic calendar is quiet today so the market will be left to its natural discovery device with the exception of Greek news flow.

Looking at the bigger picture, the Nasdaq went on a strong rally which started early February around 4220. Part of the catalyst was news from Greece. Before this rally we spent several months in a 2-way grind. Here is an interesting look at the forest:


Last week we started March with a gap up and strength through Monday. The rest of the week was mixed action which ultimately gave way to selling on Friday. Buyers managed to step in ahead of the mini value area around 4380 last week. Heading into today that zone may behave like a magnet.

My primary expectation this morning is for sellers to work into the overnight inventory and press the gap closed to 4406. By doing so they assert their responsiveness and increase the likelihood we continue discovering lower prices. I will look for them to take out overnight low 4396.25 and target the discrete gap down at 4386.25.

Hypo 2 is sellers cannot close the overnight gap and strong buyers take back much of Friday’s selling starting with acceptance above 4414. Buyers will look to target the low end of the value zone above at 4436.

Hypo 3 is we fill the overnight gap down to 4406 and then revert to quiet, two-way trade.

The short term levels I will be operating from are highlighted below:


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They Front Loaded March

We started the month of March up near swing high with market trading sideways in the short term. Price went gap up Monday and tested higher before finding responsive sellers, then tested lower yesterday and found responsive buyers. Heading into today, the Nasdaq is slightly positive on the month. Price managed to cut slightly higher than it did lower in the process, likely the case due to its alignment with the higher time frame trend.

Yesterday was a busy day economically and it showed. The Nasdaq was whipping around pretty good yesterday as it digested record builds in oil/gas inventory and the Fed Beige Book. This morning we had Continuing/Initial Jobless Claims out at 8:30am while a Mario Draghi press conference took place.

We also have Factory Orders at 10am and Natural Gas Storage stats at 10:30am. Also at 4:30pm the Fed will release the preliminary results of its 2015 Bank Stress Test.

Heading into today, my primary expectation is for sellers to work into the overnight inventory to target a gap fill down to 4445.50. If buyers can defend then I will look for a move toward overnight high 4458.75.

Hypo 2 is sellers push down below 4440 triggering an acceleration lower to take out yesterday’s low 4422 to target the NVPOC at 4418.

Hypo 3 is buyers continue working up above 4458.75 to target the mCLVN at 4465.25 and work above Tuesday’s high 4472.50.

Levels are highlighted below:


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Range and volume picked up slightly compared to recent weeks but still is well within the confines of normal. Price spent most of the overnight session pushing lower but flattened out before taking out yesterday’s low.

Yesterday we opened gap down and buyers were unable to fill the gap. Instead sellers stepped in just beyond the VPOC 4470 and began pressing lower. They managed to take out Monday’ low and pressed below last Friday’s low before finding responsive buyers. Once found, buyers pushed back up abpve the mid to close the session down slightly.

This morning we head ADP employment change which came out a bit worse than expected and saw a muted reaction in the futures. Ahead on the docket is Fed Evans talking economics at 9am, ISM Non-Manufacturing Composite at 10am, Crude/Distillate Inventories at 10:30am, and most important Fed Beige Book at 2pm.

Heading into today, my primary expectation is for buyers to work into the overnight inventory early on and press for a gap fill up to 4457.50. From there I will look for yesterday’s sellers to become initiative and work lower through yesterday’s session low 4432.50 to take out the weak/double low at 4429.25 and target the NVPOC at 4418.

Hypo 2 is buyers hold yesterday’s low and work higher to close the Monday/Tuesday gap to 4478.75.

Hypo 3 is a drive down off the open, take out weak/double low 4429.25 early and press down through the LVN at 4413.

Levels are highlighted below:



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The Calm Before The Storm

The economic calendar is quiet this morning but the week is back-loaded with events. Keep in mind Fed Chair Yellen is speaking around 8pm this evening about bank regulation. We also have ADP employment data tomorrow morning before the open.

Yesterday the Nasdaq opened gap up to start the week and sellers were not quite able to fill the overnight gap.   Instead buyers stepped in and made a strong drive up early on. Shortly after we went range extension up before falling back to the MID which lined up with the value area high from 2/26. Buyers then executed a second wave of buying, a completion wave. Overnight price has been drifting lower and spent several potions of the globex session trading 1-time frame down.

Heading into today my primary expectation buyers to push into the overnight inventory early on and target a gap fill up to 4478.50 then 2-way consolidation between 4478 and 4463.50.

Hypo 2 is sellers continue to push during the open, take out 4463.50 to test 4460.75. If no responsive buyers show then look for a fast push down the single prints to take out Monday’s low 4449.75. Look for responsive buying at 4447.25.

Hypo 3 is we push up through yesterday’s close 4478.75 and continue pushing higher prices.

Levels are highlighted below:


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Ease into March

Heading into the new month the Nasdaq is trading up a few points. The overnight auction has been on normal range and volume and shows sellers having the slight edge for most of the session. This is shown by rotation size and the weaker looking session low.

Heading into today, my primary expectation is for prices to close the overnight gap to 4448 and then test higher to the VPOC at 4457.75. Overnight high is also up there at 4458 if buyers can take out the ONH the look to continue and test swing high 4464.

Hypo 2 is sellers push down through Friday close 4448 and take out overnight low 4446.5. If buyers no show at 4440 mCVPOC then take out weak low at 4429.25 and target NVPOC 4418.


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