16 August 2018 (9:05 AM EDT)
U.S. stock futures are trading with high gains indicating a higher opening after a fall in the last session. This will keep these markets within their previous trading range.
European stock markets are also trading positive, but cautiously and are not showing much enthusiasm about higher U.S. stock futures.
Dow Jones futures are 200 points higher at the time of writing, indicating that the index might open near 25,300 which also happens to be a resistance level on hourly charts. Since U.S. stock markets have been opening with gap up and down in recent sessions, hourly charts can provide good indications of current dominant support and resistance levels.
For example, Dow Jones’ major support level, 25,000 is still intact although the index had fallen below this level yesterday but came up to close above this support. On the other hand, 25,300 and 25,400 have become its new resistance level and it may continue to trade within this 400 points range till some major event forces it to break this range- either on the upper or lower side.
Other major U.S. stock indexes will also become rangebound after previous fall and today’s higher opening.
Day traders should wait and observe what kind of intraday trend develops in these markets after a gap up opening. This short term trend can remain sideways or turn down again in case of any new negative development. After an initial day’s trend becomes clear, day trader can follow that trend for short duration trades.. Market volatility can remain high.