Daily Analysis - Thursday, 1/30/25

Overnight inventory is long this morning, showing optimism after yesterday's big news day. With some headwinds behind us, can NQ recover some of the losses from Monday?

Jan 30, 2025

This publication and its authors are not licensed investment professionals. Nothing posted on The Shmuts blog should be construed as investment advice. Do your own research.

The Week Ahead

Today - Thursday - 1/30/25

8:30am EST - US Initial Jobless Claims (Expected: 225k)
8:30am EST - US GDP QoQ Advance (Expected: 2.7%)
8:30am EST - US GDP Price Index (Expected: 2.5%)
8:30am EST - US Continued Jobless Claims (Expected: 1.91M)
4:00pm EST - Intel Q4 2024 Earnings
4:30pm EST - Apple Q1 2025 Earnings

Friday - 1/31/25

8:30am EST - US PCE Price Index YoY (Expected: 2.5%)
8:30am EST - US PCE Price Index MoM (Expected: 0.3%)
8:30am EST - US Core PCE Price Index YoY (Expected: 2.8%)
8:30am EST - US Core PCE Price Index MoM (Expected: 0.2%)
8:30am EST - US Consumer Spending MoM (Expected: 0.5%)
9:45am EST - US Chicago PMI (Expected: 40)

Prior Session Stats and Analysis - Wednesday, 1/29/25

Session Open: 21,599.75
Session High: 21,606.25
Session VAH: 21,559.75
Session POC: 21,481.25
Session VAL: 21,455.00
Session Low: 21,367.00
Session Close: 21,530.25
Session Settlement: 21,523.25
Session Range: 239.25 pts, 957 ticks
OI Change (Prelim): -6,905 (NQ) / +383 (MNQ)

Prior Session Analysis

Yesterday was a Normal Variation day with range extension to the downside.
We saw an initial attempt to auction price down around 1pm but buyers stepped in, and then two more attempts to auction price lower starting at 2pm with the FOMC rate statement and press conference.
Buyers responded strongly when price auctioned below 21,460. That area also coincided with the value area low from the Tuesday, 1/28 session.
Overall, it was kind of a dull day to trade; we did not see any convictional movement in either direction based on the FOMC rate decision or press conference.
NQ lost a pretty sizeable amount of business yesterday, with almost 7,000 contracts closed. My belief is this loss of business has been shorts closing positions. During Monday’s 800+ point selloff, NQ added almost 17,000 contracts. In the last 2 days, almost half the amount of those contracts have been closed in NQ. The buying pressure yesterday below 21,460 could have been shorts closing below that level.

Plan for Today - Thursday, 1/30/25

At this time, overnight inventory is long, over 100 points above yesterday’s close. This puts it slightly above the range of yesterday’s session, and if this continues, we will open out-of-balance from yesterday’s session.
I have a bullish bias today. I believe with FOMC out of the way with no surprises, a chunk of the Big Tech earnings behind us, and the emotions from the DeepSeek announcement now calmer; the market has fewer headwinds to try and retake back some of the losses from Monday. As always, though, anything can happen.
Anytime we open out of balance with a gap, opening range breakout trades in the direction of the gap or my go to trade. I will be looking for one off the open today. If we do see an auction down in price, I will be paying close attention to the levels listed above for support, yesterday’s high and value area high are the first two below current price.
The 21,400 level represents an area where there has been very strong buying on multiple occasions when price has reached that area. If price auctions down near this area I will be looking for a strong rejection.
In the event of a break of yesterday’s low at 21,367 it would change my bias, and I will be looking for short opportunities. Below that level, 21,300 and 21,200 represent high volume nodes from past sessions to look for price to be attracted to and get “sticky”. I would look for shorts between yesterday’s low and those two levels.

"The stock market is never obvious. It is designed to fool most of the people, most of the time." – Jesse Livermore