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Good morning everyone and happy Friday!
Yesterday we saw some interest in buying the dip after 3 days down, however that only lasted until about 11:30 AM EST before sellers resumed their operations. We got the bounce I was looking for although it only went about 10-15 points higher from the levels called below yet it was still enough for a nice intraday trade. Comments yesterday were....
"If the overnight lows hold and buyers flip back to demand, watch for a break over the 4750-55 area as that would put prices back over the overnight high, POC and yesterdays halfback levels. This could bring in some short covering then look for upper targets."
Even the morning low target held in the /NQ futures (16,430-440) and they managed to rally about 145 points before sellers came back in the fray. Ultimately the support levels were retested again at the end of the day and gave back all of the gains earlier in the session.
Obviously I don't have a crystal ball and can't give you exact points of support and resistance every time, but the important thing to monitor closely is price action and where value develops. Seeing that we are still one time framing to the downside and value keeps building lower, this is telling me bears still have control for now.
Futures are lower this morning with overnight inventory mixed to net short however we have a true gap lower (meaning we are gapping outside of prior days range) Futures took a further dive when the government employment report came out and the Non Farm Payrolls said 216,000 jobs were added vs the 162,000 consensus estimate signaling the economy is still hot and could have the FED act. We hit those target levels from yesterday this morning and again please see profile picture below. With this large gap down and a true gap, there could be some short covering so look for potential moves back to yesterdays lows...4727 /ES and 16,436 /NQ
A few other important levels to keep an eye out for if buyers do step back in will be /ES 4745-4747 area and for the /NQ watch out for 16,510. This could fuel some more short covering. If, however, we stay below prior days lows then the bears remain in control!
/ES upside target is: 4755-60
downside target is: 4700-05
/NQ upside target is: 16,570-580
downside target is: 16,350-360
/RTY upside target is: 1995-97
downside target is 1946-49
Economic Data Today:
Non Farm Employment Report @ 8:30 AM EST ** Red star report
Factory orders @ 10:00 AM EST
ISM Services Index @ 10:00 AM EST
Baker Hughes Rig Count @ 1:00 PM EST
More Color.......
/ES - Demand flipped to Supply overnight at $4730-44720 making a new LOD. I would
like to see buyers trapped at the open playing short targeting $4715
- Failed rally into $4740 with sellers present , playing short target $47.27
SPY - Sell off over night making a new LOD , I would like to ideally play a break and
retest from yesterday's low from $467 targeting $466.40 first then $465.90
- Buyers at the open with a failed rally to break and hold above $468 Playing
short targeting $467. 80 first then $467
- The only way I can short is if the market pushes up past $469 and holds
SPX - Strong sell off pre market : would ideally like to play the fade with price failing
to hold above $4700 targeting $4690 first then new LOD. The only way I can play long
is if we break back above $4710 with buyers holding above the price as support.
/NQ - Demand flipped to Supply at $16435-$16445 making a new LOD . I want to
short all fades with weak buying on the tape making new LOD intraday to target.
- The only way I can play long is if price holds back above $16460
QQQ - Sold off to demand at $395 , I would ideally like to play a break and retest at
$398 where Supply flipped to Demand under Tuesdays LOD , playing short target $396.
- The only way I can play long is if price hold back above $398 target $399.60
AMD - Gap down , I would like to see strong selling with price failing to rally above
$398 playing short targeting $135.60 first then $133 . Not interested in any longs/ calls
TSLA - Selling off with previous demand is below at $135-134
- Demand has been flipping to Supply since last week
AAPL- Selling off from Supply at $182-$183 with demand below at $180
NVDA - Gap down from supply where rallies have failed at $484
- Demand below that is at $472-$474
Have a great trading day and a wonderful weekend!
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