Daily Brief - Friday, 3/28/25
Core PCE came in hotter than expected this morning. Will this lead to increased volatility today and good trading opportunities?
Disclaimer
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.
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Friday - 3/28/25
8:30am EST - US PCE Price Index YoY (Expected: 2.5%, Actual: 2.5%)
8:30am EST - US PCE Price Index MoM (Expected: 0.3%, Actual: 0.3%)
8:30am EST - US Core PCE Price Index YoY (Expected: 2.7%, Actual: 2.8%)
8:30am EST - US Core PCE Price Index MoM (Expected: 0.3%, Actual: 0.4%)
10:00am EST - University of Michigan Sentiment Final (Expected: 57.9)
Prior Session Stats and Analysis - Thursday, 3/27/25
Session Open: 20,028.50
Session High: 20,199.50
Session VAH: 20,124.75
Session POC: 20,062.25
Session VAL: 20,024.25
Session Low: 19,937.25
Session Close: 19,994.50
Session Settlement: 19,990.25
Session Range: 262.25 pts, 1049 ticks
OI Change (Prelim): +7,323 (NQ)
Est Volume: 635,617
Breakdown of Market Profile
The Nasdaq (NQ) opened strong with an early breakout, but that strength didn’t last. What followed was a classic rejection of higher prices and a late-session breakdown, closing the day on a bearish note.
1. Early Range Extension (Push to 20,180)
Price broke above the initial balance early, showing initial buying strength.
2. Rejection at 20,165 (Failed Breakout)
Buyers couldn’t hold above last week’s high. Sellers responded aggressively, rejecting higher prices.
3. Reversal into Initial Balance
The failed breakout led to a full return back into the morning range—typically a bearish sign.
4. Mid-day Consolidation (Low Energy Chop)
For several hours, price action stalled. This was a sign of indecision and low momentum. The prior session’s low + value area low provided support during this time period, when price did auction below it, the key psychologic level of 20,000 provided support.
5. Late Breakdown (Settlement Below 20,000)
Support eventually broke down, and the market closed under the psychological 20,000 level.
Breakdown of 5-min Chart
Test of last week’s high (20,165) around 11:00 AM – rejected
Support held at prior day’s low + value area low for most of session
Break below those levels late in session
20,000 psychological level provided temporary support
Final breakdown into the close – NQ settled below 20,000
Volume & Participation
+7,000 contracts added in open interest
635K contracts traded – higher volume than the previous session
~200 point range — relatively contained but with clean structure
Takeaway: Participation increased, but the market rejected higher prices—suggesting sellers are gaining control, at least in the short term.
Final Thoughts on Yesterday’s Session
This session is a great example of how important context and levels are. Despite early strength, the market failed to hold above key resistance and reversed hard. Recognizing these shifts in real-time helps traders avoid traps and align with the dominant force—sellers, in this case.
Pre-Market Plan – March 29
As of this writing, overnight inventory is short by about 100 points relative to yesterday’s settlement. That means sellers were more active overnight, and we’re likely to open with downward pressure.
At 8:30 AM, PCE inflation data was released. Core PCE came in hotter than expected, and the market has reacted bearishly. This kind of inflation surprise can shake up market sentiment, and we’re seeing that reflected in the price action.
What This Means for the Open
We’re likely to open out-of-balance—meaning below yesterday’s entire range, with a gap to the downside. This creates potential for strong directional moves, especially early in the session.
Game Plan
Opening Range Breakout (ORB)
If price breaks below the opening range and holds, I’ll look to trade in the direction of that breakout.Gap Rules in Play
If the gap does not fill within a reasonable timeframe (often the first 15–30 minutes), I’ll trade with the gap direction—in this case, short.Momentum Moves
If we get clean trend behavior, I’ll look to enter on momentum and ride the wave with tight risk controls.Key Levels
As with yesterday’s session, if certain levels start showing clear reactions (support turning to resistance, or vice versa), I’ll look for opportunities around those zones.
Mindset Today: Be prepared for volatility. Don’t chase moves—let the setups come to you, especially if the initial reaction to the data is sharp or emotional.
Key Levels I’m Watching
20,475 – Pivot point from the big move down on March 26. If the market reclaims this level, it would be a strong bullish signal.
20,200 – Yesterday’s high. Acted as resistance both yesterday and during the March 26 session.
20,165 – Last week’s low. Price tested it yesterday but failed to find momentum above—still acting as resistance.
20,145 – Resistance zone during both yesterday’s regular session and today’s overnight session.
20,045 – A major support level yesterday. Now that we’ve dropped below it, watch for this area to flip into resistance if price attempts to push back up.
20,000 – Psychological level and key intraday support yesterday—until it gave way late in the session.
19,940 – Buyers stepped in strongly at this level off the open yesterday, rejecting the move lower and launching price back above 20,000. Important area to watch for buyer interest.
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