Daily Brief - Wednesday, 7/9/25
NQ's Masterclass in Doing Nothing Continues. Is a big move incoming?
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.
News Docket
It’s a very light week in regard to data releases. The most significant market movers will be the Reciprocal Tariffs deadline and the FOMC Meeting minutes on Wednesday. I expect a very busy news cycle leading up the the tariff deadline.
Wednesday - 7/9/25
12:00 am EST - US Reciprocal Tariffs Deadline
2:00 pm EST - FOMC Meeting Minutes
Thursday - 7/10/25
8:30 am EST - US Initial Jobless Claims (Expected: 240.5k)
8:30am EST - US Continued Jobless Claims (Expected: 1.962M)
Prior Session Analysis - Tuesday, 7/8/25
Session Stats
Open: 22,935.50
High: 22,962.75
Low: 22,841.00
Close: 22,891.75
Settlement: 22,896.75
Range: 121.75 points / 487 ticks
Volume: 421,132
Open Interest Change: +1,880 (NQU5)
Value Area (Market Profile)
Value Area High (VAH): 22,930.00
Point of Control (POC): 22,905.00
Value Area Low (VAL): 22,880.00
Prior Session Breakdown - Market Profile and NY Session
Tuesday's session was a textbook normal day with a classic "D"-shaped profile, confirming the balanced market structure that has characterized recent sessions. The day remained an inside session from Monday's range, with no meaningful range extensions despite early testing of both boundaries.
The session opened at 22,935.50 and immediately faced selling pressure, driving price down to 22,849.00 within the first hour—a clean initial auction lower that established the session's range. From there, price rotated between the edges of the initial balance for the morning session before settling into flat consolidation that persisted through the close. The lack of headline drivers allowed the market to trade in its natural state, revealing a clear absence of conviction from both buyers and sellers.
Most notably, price failed to break above 22,958.00, the same level that acted as resistance during Monday's tariff-driven volatility. This area continues to serve as a significant pivot point, suggesting institutional supply remains stationed there. On the downside, 22,850.00 held as support for the second consecutive session, reinforcing its importance as a key structural level.
Value area range showed minimal movement, with VAH holding exactly at Monday's 22,930.00 level—a sign that the market remains comfortable with current pricing. The POC shifted slightly higher to 22,905.00, indicating marginally more time spent in the upper portion of the range despite the early selling pressure. This centered POC placement, combined with the balanced profile shape, confirms the market's current "wait and see" posture.
The VAL tightened to 22,880.00, creating a narrower value area that reflects the session's compressed trading range and lack of exploratory activity beyond established boundaries.
Volume & Participation
Total Volume: 421,132 – lower than recent sessions, continuing the pattern of reduced participation during balanced conditions
Open Interest: +1,880 contracts (NQU5) – a modest increase suggesting some inventory adjustments and positioning ahead of today's FOMC minutes
Price Range: 121.75 points / 487 ticks – compressed range typical of normal days in low volatility environments
The volume decline reflects the market's transition back to the low-participation pattern seen last week, while the positive open interest change suggests participants are making deliberate adjustments to their positioning. This combination often precedes periods of increased volatility, as traders position for upcoming catalysts. In other words, the market is coiling. Be prepared for the move when it happens.
Final Thoughts
Tuesday's session epitomized the current market regime: balanced, range-bound, and lacking conviction. The clean "D" profile and centered POC tell the story of a market in equilibrium, patiently waiting for the next catalyst to provide direction. With no major headlines to drive sentiment, the session revealed the market's natural state—cautious and consolidative.
The failure at 22,958.00 and support at 22,850.00 have now established clear boundaries for the near term. Volume patterns and open interest changes suggest participants are positioning for either or both, today's FOMC minutes, and additional tariff news, which could finally provide the spark needed to break the current balanced structure.
Today’s Analysis – Wednesday, 7/9/25
Market Context
The NQ is set to open this morning with modest long inventory, currently trading at 22,927.50, approximately 31 points above yesterday's settlement. This places price comfortably within yesterday's range and maintains the balanced posture that has characterized recent sessions. The overnight action has been entirely contained within Tuesday's parameters, suggesting no significant overnight developments to alter the market's cautious stance.
We continue to operate in a low volatility, positive gamma environment where dealer hedging behavior supports any meaningful dips. This regime has been evident in the market's consistent ability to find buyers on weakness, particularly around the 22,850.00 level that has provided reliable support across multiple sessions. The compressed ranges and lack of follow-through we've witnessed are classic characteristics of this environment.
Today brings the potential for a regime shift with FOMC minutes scheduled for release at 2:00 PM EST. While tariff headline risk remains a constant factor, the market's sensitivity to these developments has diminished somewhat, as evidenced by yesterday's calm response to the absence of significant news flow. The key backdrop remains unchanged: institutional inventory is positioned for higher prices, and any meaningful liquidation would require a significant catalyst to materialize.
Bias & Mindset
Bias: Neutral → Bullish
I'm maintaining a neutral-to-bullish bias heading into today's session, with particular emphasis on patience and selectivity. The structural factors remain supportive of higher prices, but the timing of when a move will happen is uncertain. The market's balanced nature means we could see movement in either direction based on the interpretation of the Fed's commentary later today.
With volatility suppressed and positive gamma still dominant, the environment continues to favor range-bound trading with occasional failed breakout attempts. The FOMC minutes represent the first real catalyst in several sessions, making today potentially more dynamic than recent balanced days. However, until we see evidence of sustained institutional activity, the bias remains toward mean-reversion and range-bound behavior.
Key Levels I’m Watching Today
Upside:
23,059.00 — High volume node from Thursday's session (7/3), significant resistance level
23,000.00 — Major psychological level and potential magnet for price discovery
22,962.75 — Yesterday's high, break above with acceptance could signal higher fair value
22,958.00 — Tariff news pivot from Monday (7/7), held as resistance yesterday
Downside:
22,880.00 — Yesterday's VAL, important support within current value area
22,850.00 — Critical support level that has held for two consecutive sessions
22,840.00 — Yesterday's low, break and acceptance below would indicate lower fair value
Final Thoughts on Today
Today represents a potential inflection point in what has been a persistently balanced market. The FOMC minutes at 2:00 PM provide the first meaningful catalyst in several sessions, with the potential to either extend the current consolidation or spark the volatility that has been notably absent. The market's positioning suggests participants are prepared for movement, as evidenced by yesterday's modest open interest increase.
The key will be watching for any signs of institutional conviction following the Fed's release. Until then, the same balanced, low-opportunity environment persists, requiring patience and discipline from traders. If the minutes fail to generate sustained momentum, expect a continuation of the range-bound, mean-reverting behavior that has defined recent sessions.
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