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Good Wednesday morning!
I feel like Bill Murray in the movie Groundhog Day....same story over and over and over. Buyers, especially in the DOW and S&P have stood their ground once again and there still seems to be ZERO sellers on planet earth!!! Ahh but could the tide be changing and storm clouds brewing on the horizon?!?!
While there was some selling in the NASDAQ, I am sure that after such monster gains in stocks like MSFT and GOOGL which reported last night, a few people decided to take a some chips off the table...no big deal yet but we must pay close attention!! It was the ole' "Buy the rumor, sell the news" reaction!
I have been saying for quite some time that as the market just keeps going up and getting very overextended, the risk for a liquidation break rises. And well that is what we finally got yesterday, but more in the NASDAQ than anything else. We really need to see if money just rotates out of large cap tech and into other sectors like Industrial s (XLI), Financials (XLF), Consumer Staples (XLP) and Healthcare (XLV), which have all been doing very well. If this does continue to happen, then the amount of volatility could intensify on an intraday basis as money just keeps being moved around from one sector to the next! It's kind of like the shell game we all know and love......you know where the street vendor puts a marble under one coconut shell and then mixes them all around and you have to guess which one its under! Yeah that shell game!
ANYWAY......HEADS UP....VERY IMPORTANT!!!! The FED comes out this afternoon with their decision on interest rates, however the markets know they won't do anything as their is still a 98% chance of holding at current levels. That being said there is usually HUGE volatility around the announcement and FED Chair Powell's press conference speech @ 2:30 PM EST! STAY ALERT OR SIT ON HANDS!
The profile pic below shows some key levels again so pay close attention...if we fade higher then first target will be prior days low. If we stay below the 4935 area, then that support becomes new resistance and look for downside targets. Below 4925-4920, then 4905 then 4890 would be next on the list!
Futures are mixed but lower this morning with true gaps below yesterdays range in both the /ES and /NQ. Stay alert!
And yes you guessed it....we have just added ANOTHER NEW VPOC below us and we now sit with 17 untested points of control below us. A new record!
/ES upside target is: 4955-60
downside target is: 4925-20
/NQ upside target is: 17,650-675
downside target is: 17,375-350
/RTY upside target is: 2027-31
downside target is: 2009-06
Economic Data Today:
ADP Employment Report @ 8:15 AM EST
Treasury Refunding Announcement @ 8:30 AM EST
Chicago PMI @ 9:45 AM EST
Crude Inventories @ 10:30 AM EST
**FED Announcement @ 2:00 PM EST
More Color.......
/ES - Consolidating below Key Demand between $4925-4935 then at $4870-4890
- The only way I want to play short is if price can fall and hold below $4900
- Ideally I want to see sellers trapped at $4905-4910 to play long targeting $4930
SPY - Key demand zones at $488 and $484-485 then at $482
- If price can hold below $488 I will look to short failed rallies
- Ideally I would like to play break and retest from Demand at $485 targeting $487
SPX - Supply flipped to Demand at $4900-4910 with Demand below at $4870-4880
- As long as price holds above $4868 I would like to play long
/NQ - Key Demand at $17410-17465 then not until $17225-17200
- If price breaks and holds below $17400 and holds after a pullback I would like to
play short targeting $17368 then $17348
QQQ - Price consolidating below demand looking to flip to Supply
- If price can hold below $420 I would look for a quick scalp SHORT
- If sellers become trapped at the open with a sell off holding above $415 I would
look to play long targeting $417 first then $419
- If price can reclaim and holds above $422 I will look to play long
AMD Huge sell off over night with Demand flipping to Supply at $163-164
- Nearest Demand isn’t until $154-156
Have a wonderful day and a great weekend!
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