Daily Brief - Friday, 8/8/25
Thursday's 213-Point Gap Gets Filled; Smart Money Buys the Dip
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News Docket
Friday - 8/8/25
US’s Russia/Ukraine Peace Deal - Sanctions Deadline
Prior Session Analysis - Thursday, 8/7/25
Session Stats
Open: 23,601.00
High: 23,671.00
Low: 23,329.00
Close: 23,501.00
Settlement: 23,496.25
Range: 342.00 points / 1,368 ticks
Volume: 562,983
Open Interest Change: -1,790 (NQU5)
Value Area (Market Profile)
Value Area High (VAH): 23,540.00
Point of Control (POC): 23,415.00
Value Area Low (VAL): 23,370.00
Prior Session Breakdown - Market Profile and NY Session
Thursday was one of those sessions that keeps you on your toes—a perfect reminder that in this business, gaps can disappear as quickly as they appear. We opened with a hefty 213-point gap higher at 23,601, and for the first 30 minutes, it looked like the bulls were going to keep the party going. Price tested the highs right off the open, reaching 23,671, which was curiously very close to that VAH from July 31st.
But that high was immediately rejected and never revisited—a sign that participants flat out rejected fair value near or at those levels. What followed was an extended downtrend that lasted for most of the session, with the gap getting completely filled at 12:40 PM. By 2:30 PM, we had fallen all the way from just under 23,680 down to 23,329.
Then NQ pulled one of its classic moves—the "V" reversal that this market is famous for. Buyers stepped in with real conviction for the next 90 minutes, auctioning price back up above VWAP and managing to close right around 23,500, smack in the middle of the day's range. The session developed into a normal variation day with a "b"-shaped profile and downside range extension, but that recovery into the close kept things from looking completely bearish.
Here's what made this session really interesting from a flow perspective: cumulative volume delta was positive for the entire day, even during that extended selloff. I’ve included an image of it above. When you see CVD diverge against price like that during a trending move, it usually indicates smart money—institutions—going against the trend. My best guess is that we saw institutional players taking advantage of the selloff to accumulate long inventory in anticipation of another leg higher.
The value area rotated higher, settling between 23,370 and 23,540 with the POC at 23,415. The higher positioning reflects the session's ultimate recovery despite the midday weakness. The POC sitting in the lower third of the value area confirms that most of the session's business was conducted during the selloff phase, but the late recovery shifted fair value higher by the close.
Volume & Participation
Total Volume: 562,983 – similar to recent sessions, showing consistent engagement
Open Interest: -1,790 contracts (NQU5) – modest outflow that was actually surprising given the positive CVD all day
Price Range: 342.00 points / 1,368 ticks – substantial range reflecting the gap opening and subsequent reversal
The combination of positive CVD with negative open interest is head-scratching. Sometimes in this business, you can't tell definitively from the data what was happening—you just have to make your best educated guess based on experience. The positive CVD suggests institutional accumulation during weakness, but the OI decrease indicates some position unwinding was also occurring.
Final Thoughts
Thursday was a perfect example of why you don't get married to overnight gaps, no matter how impressive they look. The market gave back all of Wednesday's late gains and then some, but the key was how it recovered into the close. That V-shaped reversal combined with positive CVD throughout the selloff suggests the underlying demand is still there.
The session felt more like a rebalancing after Wednesday's strength rather than a fundamental shift in sentiment. The market tested deeper levels than expected but ultimately found buyers willing to step in at the right price.
Today’s Analysis – Friday, 8/8/25
Market Context
The overnight session has been remarkably calm after Thursday's wild ride, with the NQ currently trading at 23,578, about 82 points above yesterday's settlement. The overnight range between 23,583 and 23,501 has been tight and contained, suggesting we're opening in balance after Thursday's dramatic gap-fill and recovery.
The VIX popped up a bit yesterday during the selloff but is back down almost 2% this morning to 16.26 as I write this, which suggests the fear from Thursday's action has already dissipated. We remain in that positive gamma environment with dealers ready to buy dips, which probably explains the overnight stability.
The consolidation overnight appears to be reflecting some apprehension about today's macro deadline—there's supposedly a Ukraine/Russia peace deal deadline today, along with potential sanctions against Russia. Though honestly, I expect this to either get pushed back or turn out to be a nothing burger, as these Trump imposed deadlines often do.
Bias & Mindset
Longer Term Bias: Bullish
Today’s Bias: Bullish
I'm leaning bullish with medium confidence, and here's why: after seeing what was happening under the hood yesterday with that positive CVD during the entire selloff, I feel good about the underlying demand. My biases are often wrong, so take it with a grain of salt, but the smart money appeared to be accumulating during yesterday's weakness.
Other than that Ukraine/Russia deadline (which I'm skeptical will amount to much) and the usual Friday reluctance to carry positions over the weekend, I don't see any major headwinds today. It's possible I'm a session early on this bias, but the technical setup looks constructive.
That said, I won't let my bias get in the way of reading the price action. With this in-balance open, I'll be patient and let the session develop, following the developing value in either direction and looking for better trade opportunities as they present themselves.
Key Levels I’m Watching Today
Upside:
23,752 — All-time high, still the ultimate target for the bulls
23,671 — Yesterday's high, first real test of strength
23,583 — Overnight high, immediate resistance
Downside:
23,501 — Overnight low and yesterday's close area, this is not a coincidence
23,370 — Yesterday's VAL, more meaningful support
23,329 — Yesterday's low, major support level
Final Thoughts on Today
We've been consolidating overnight, which often happens when there's macro uncertainty on the horizon. Sometimes in-balance opens like this lead to the biggest moves when price has been consolidating overnight, but other times the consolidation just continues throughout the regular trading session. We'll have to be patient and see how it develops.
The fact that we're sitting just below those all-time highs with positive gamma supporting dips and institutional money seemingly accumulating on weakness creates an interesting setup. The question is whether today brings the breakout attempt or more of the consolidation we've been seeing.
Friday dynamics can be tricky—some traders don't want to carry positions into the weekend, especially with geopolitical headlines swirling around. But others might see it as an opportunity to position for next week if they think the technical setup is compelling.
Stay flexible, watch how the opening auction develops, and remember that sometimes the best moves come from the most boring setups. The market has a funny way of rewarding patience when everyone else is getting impatient.
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