Tuesday’s Futures session began with indecision but ended with a strong bullish reversal. The market broke through key resistance levels and closed near session highs, shifting traders’ focus to Wednesday’s Fed news.
Early Session Consolidation: Key Levels Hold Firm
The Nasdaq remained range-bound during the Asian and European sessions, consolidating between the Weekly VWAP (white line) and the Monthly VWAP (orange line). Attempts to break above the Monthly VWAP met selling pressure, reinforcing its role as a key resistance level. This period of indecision highlighted a cautious market sentiment as traders awaited the U.S. session for direction.
U.S. Session: Bulls Regain Momentum
The U.S. session opened with a push to the downside, with the market breaking below the Weekly VWAP and testing Monday’s Value Area Low (VAL) at 21,149. However, buyers swiftly stepped in, signalling a shift in sentiment.
As bullish momentum grew, the market reclaimed Monday’s Value Area High (VAH) at 21,283 and finally broke above the Monthly VWAP, which had previously acted as a strong resistance. Bulls continued the rally, driving prices into the 21,500s as buyers firmly took control.
Key Takeaways from Tuesday’s Session
Tuesday’s price action emphasised the importance of VWAP levels and value areas in identifying pivotal market turning points. The Monthly VWAP, which initially acted as a barrier, transformed into a springboard for the breakout.
Monday’s VAL proved to be a critical support level, as buyers stepped in quickly to support it and kickstart the rally. These levels highlighted how some market participants use them to pinpoint opportunities.
Looking Ahead: Fed News and Nasdaq Outlook
Wednesday’s session will be heavily influenced by the Federal Reserve’s policy meeting. Markets widely expect interest rates to remain unchanged, but Fed Chair Jerome Powell’s press conference could provide critical clues on future monetary policy.
Additionally, major earnings reports from companies such as Meta Platforms, Microsoft, Tesla, and Visa are expected to shape market sentiment further. Combined with Fed news, this sets the stage for what could be a highly volatile trading session.
