|
Good Thursday morning!
Yesterday we got a big drop in the S&P and an even bigger drop in the NASDAQ, however, the DOW hit new all time highs again and this is a classic example of sector rotation!
Traders and investors (for the time being) are moving out of growth (large cap tech) and into value (financials, healthcare and energy) so this is why the DOW could be up +243 points yet the NASDAQ was down over -500 points yesterday! Big question for today will be.... will this continue or was it yet another short term event and buyers step back into large cap tech immediately?!?!? Time will tell.
Futures are mixed and overnight inventory is almost 100% net long this morning (exact opposite of yesterday) however we are inside of yesterday's range and there is no true gap. Please make a note of the price and target levels below and see which way the balance of markets swing. Will the buyers take us back over yesterday's highs and try to fill the gap to Tuesday's lows or will we stay in range and maybe sellers retest prior days lows? Please remember one day does not make a trend so stay fluid.
Quick recap....As far as key price levels and targets yesterday, I was not sure they were going to be hit but the lower target area of 5635 - 5625 was nailed as the low was 5633.25! As I pointed out in Morning Color yesterday before the open.......
"Looking further out, I have some lower target levels so please keep them in mind. We may not hit them today, but over the next day or two, they could easily be reached. Today will be all about how much of a bounce is achieved in the markets. If the bounce is very shallow and we do not even fill the gap to yesterdays low, then this will be the most bearish outcome and look for more downside in the days to come!"
Well the scenario played out very nicely. Price did not fill the gap to Tuesday's lows AND we added a new VPOC above us AND value built lower, so these are all decent signs of things to come, especially in the tech heavy NASDAQ! The stage is set for lower BUT we need to see more confirmation from the sellers.
An important line in the sand will be the 5653-5652 area which is the Value Area High and 1/2 back from yesterday. Price exploration above may bring in more buyers and shorts could get squeezed. Price below 5652 yet above 5640 will be balance and any price action that goes below 5640-5637 (Point of Control, Overnight low and Value Area Low) could bring in more sellers! Then you can look for lower targets. The stage is set...let's see who wins!
VPOC Update: Yes, finally a new VPOC's was added ABOVE current prices @ 5699.50 yesterday, so we now have 1 above and still 25 VPOC's below current price levels!
TARGETS AND KEY LEVELS TO WATCH:
/ES upside target is: 5675 - 5680
Key Level: 5640 -5637 POC, Overnight Low & Value Area Low
downside target is: 5625 - 5620
/NQ upside target is: 20,230 - 20,260
Key Level: 20,130-20,125 VAH & 1/2 Back
downside target is : 19,845 - 19,825
/RTY upside target is: 2290 - 2295
downside target is: 2260 - 2255
Economic Data:
Jobless Claims @ 8:30 AM EST
Philly FED @ 8:30 AM EST
Leading Indicators @ 10:00 AM EST
Natural Gas Inventories @ 10:30 AM EST
More Color.......
/ES - Demand $5610- 5620 with Supply at $5680 -72 then above at $5692
1. Buyers trapped below $5680 and holding below after a pullback will be
looking to play short targeting $5650 then $5638
2. Sellers trapped above $5680 where Supply flips back to Demand looking to play long targeting $5700 then $5710
SPY - Demand at $555-555 with Supply at $560-61 then at $564-565
1. Buyers trapped below $561 after a break and retest from $560 playing short targeting $$558 then $555
2. Sellers trapped above $555 looking to play long from a break and retest from $556 targeting $558 then $560
SPX Demand at $5617-5622 Key Supply at $5670
1. A breakdown below $56015 and holding below after retest I will look to play short targeting $5600 then $5690
2. A bounce above $5622 and reclaim support I will look to play long
targeting $5642 then $5655
/NQ Key Demand at $19962-80 with Supply above at 20370-59
1. Sellers trapped above $20250 after Supply flips back to Demand looking to play long targeting $20275 then 85
2. Buyers are trapped below $20259 off a break and retest targeting $20200
QQQ Demand at $479-480 with Supply above at $488-487
1. Sellers trapped above $479 looking to play long off a break and retest
from $480 targeting $482 then $485
2. Buyers trapped below $488 after a break and retest from $487 looking to targeting $485 then $484
AAPL Key Demand at $225-226 then Supply at $230-228
1. Buyers trapped below $230 looking to play short after a break and retest from $229 targeting $227 then $226
TSLA Gap Down Key Demand at $244-243 with Supply above at $256-257
1. Sellers trapped above $243 looking to play long after a bounce targeting $245 then $248 then $250
2. Buyers trapped below $242 after a break and retest looking to play short
AMD Key Demand at $157-159 with Supply above at $165-164
1. Sellers trapped above $157 looking to play long targeting $160 then $164
2. A breakdown below $165 and holding below I will look to play short off a break and retest from $164 targeting $161 then $159
NVDA Key Demand at $112-114 with Supply above at $141 HOD -137
1. Sellers tapped above $112 looking to play long targeting $115 then $118
2. A breakdown below $112 and holding I will look short after a break and retest from $111 targeting $109 then $107
Have a great day!
| 
