Daily Brief - Thursday, 3/6/25
Yesterday's profile matched the prior sessions with a tighter range. This market is waiting for more information before deciding which direction to move. Will it get that new information today?
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Upcoming News
Thursday - 3/6/25
8:30am EST - US Trade Balance (Expected: -92.8B, Actual: -131.4B)
8:30am EST - US Initial Jobless Claims (Expected: 233k, Actual: 221k)
Friday - 3/7/25
8:30am EST - US Unemployment Rate (Expected: 4%)
8:30am EST - US Nonfarm Payrolls (Expected: 155k)
8:30am EST - US Average Earnings YoY (Expected: 4.1%)
12:30pm EST - Fed Chairman Powell Speaks
Prior Session Stats and Analysis - Wednesday, 3/5/25
Session Open: 20,421.25
Session High: 20,725.00
Session VAH: 20,575.25
Session POC: 20,438.00
Session VAL: 20,275.00
Session Low: 20,215.00
Session Close: 20,658.00
Session Settlement: 20,665.00
Session Range: 510 pts, 2040 ticks
OI Change (Prelim): +1,038 (NQ) / -3.343 (MNQ)
Est Volume: 779,653
Prior Session Analysis
Yesterday’s session as another Normal Variation day with range extension to the upside during the afternoon. NQ added a very small amount of new business at +1k contracts on lower value than we’ve seen in the past 4 sessions with 779k contracts traded.
I included the market profile from yesterday along with Tuesday’s session profile to show how similar they both are. Yesterday’s profile was pretty much identical to Tuesday’s, just in a tighter range. The support area at the bottom, or discount area if you will, did roll higher but the resistance area at the top, or premium area, did not change. We saw price get too expensive for participants in the same area. With little change in new business and the range not expanding, known as an inside day, this leads me to infer that this is a market waiting for more information before deciding which direction to auction price.
As far trading was concerned, there were no clear ranges defined for range based traded and there were two auctions up that provided some opportunities for momentum based trades, one around noon and another around 2pm. Outside of the choppy action off the open the price action was fairly clean, we consistently saw levels of resistance become levels of support in between the legs up. The prior session’s value area low, value area high and session high all provided area’s of support or resistance during the session.
Besides the news that tariffs would be delayed for automakers by one month, additional news on tariffs was light yesterday which is why I think we saw the range not get extended from the prior session in either direction and we had an inside day. News could come out at anytime so what happens today will remain to be seen.
Plan for Today - Thursday, 3/6/25
At the time of this writing overnight inventory is quite short, -300+ points below yesterday’s close. Because the close was at the top end of yesterday’s range, overnight price is still in-balance and in value from yesterday’s session despite the fairly substantial gap below yesterday’s close.
Trade balance news came in worse than expected but Initial jobless claims came in not as bad as expected this morning at 8:30am. So far the market’s reaction to the news has been muted.
Assuming we open in-balance, my plan today will be patient with a close eye on the news feed for any market moving news. Better trade opportunities will likely emerge as the session progresses. As I mentioned before I believe this is a market waiting for more information and tariff news will move the market if or when it comes out.
Also, I will be on the lookout for any short squeeze that may develop but at this point I think it will need a catalyst to spark it. As things stand there is no reason for shorts to look to exit at this time.
Levels I have on my chart today:
21,000 - it would take a substantial move to get here today but a potential area of resistance in the event it happens.
20,725 - this has been an area of resistance for the last two sessions, it was also an area of consolidation on March 3rd and Feb 28th.
20,575 - yesterday’s value area high, has been an area of support and resistance multiple times over multiple trading sessions going back to Feb 28th.
20,215 - yesterday’s low, an auction in price below here would be a sentiment alert for lower prices.
20,000 - if price auctions below 20,215 I believe the 20,000 level will be in play. Unless there’s a really strong catalyst behind the auction down I expect there to be a battle at this level.