Hitting the Bid

Pre-market Missal for August 24, 2023

A Wrap Up

Our day pivot of 4412 was near spot on, as this was effectively swept up by eager buyers at open for a big push to the upside (and into ETH!). We are OTFU on the daily.

In last week’s Thursday Missal I wrote that we were at or near swing lows. We are now up 100+ points from that issue, which validates that thesis in my definition (100 point, or 2.5%). Buyers have done decent work - they were consistently hitting the offer aggressively on Tuesday and Wednesday. Recall that despite the selloff from open and (tick) close under 4400 on Tuesday, I leaned long at close and shared this publicly. As of writing we are 70+ points above that level and opening on a likely gap up. Gap up rules apply.

Yesterday saw effective OTFU into close as long term largely stepped out of the way and short-term sellers were forced to stop out on rising price, lending to a mechanical grind up with three sets of heavy upside initiation.

Today’s Missal

I am watching 4454, or yesterday’s intraday high (and poor high), as an intraday pivot. We saw a large gap up on the NVDA beat - look for this gap to hold. A loss of the gap and trade into yesterday’s value area is a bearish event given the context.

a) Buyers want to defend the pivot (gap), and if we drop lower may find a bid around spike halfback at 4459. This could target the ONH of 4485, a break of this puts 4496 and potentially 4504 and then 4510 in view. A break of the 4518 level will result in an end to weekly OTFD which can puts buyers firmly back in control.

b) Sellers look to defend the ONH. Time spent under 4454 would then target 4442 PDPOC, a loss of which open a test of singles to 4431. Finally, the prior day pivot 4412 will be an important target to consider in a less likely event of liquidation.