The charts today are all hourly charts for MNQH23
Today is quadruple witching day after a very bearish week. All contracts are expiring and even though things are incredibly oversold with MNQH23 on the lagged price volume (ratio) calculation and the binary price/volume indicator, it could get even more oversold with the pressure of expiration. Volume currently favors the bears, but all that can change at the open at 0930 EST.
I will wait until this weekend to do an in-depth pattern analysis, as today’s actions, active or muted, will have an influence on measuring the extensions based on where prices close. I tried to take on one longer-term aspect of market action, but I think seeing what happens today will have some analytical impact that must wait until the price action completes.
The chart at the bottom gives you an idea of how oversold things are, given the fact that the VWAP is at 11463 and price action is in the 11300s in the 0500 EST hour. If we cannot exceed the VWAP line at 11463, I would contend that it might run out of gas if a rally goes to 11425.75 and perhaps to 11558, as that is close to a 78.6% retracement of the last bearish price swing. If it can blow through the highs at 11496 it could rally to 11546. I have no idea if that is possible, but as you have seen this week, nothing seems out of the reach of euphoric and desperate retail and institutional traders.
On the downside, a break of 11312 would likely lead to lower lows of 11262 and 11198.25.
I have had a successful week on both sides of the market. Today, if I see something that fits the volume criteria and price momentum at a breakout, I will trade it. If not, I will sit on the sidelines and get other business done. I am incredibly busy at the moment.
We will get deep into the pattern analysis this weekend. Depending on where things settle, there could be a major impact on where this correction finishes up and where the next larger move is.
More will be coming soon.
Economic Data courtesy of Econoday dot com
Quadruple Witching
PMI Composite Flash
9:45 AM ET
Mary Daly Speaks
12:00 PM ET
Baker Hughes Rig Count
1:00 PM ET
Black Friday
or not
A decisive down leg would suit my current position. We’ll see what games are in store.