Short Covering, Double Distribution

Short Covering, Double Distribution
Short Covering, Double Distribution

The market profile chart formed a second, higher distribution above the earlier 5th (E) period high, after an upward spike in J period, rallying to just two ticks shy of the upper distribution low from Wednesday’s profile.

Focus for Friday could be on acceptance or rejection of the upper distribution from Thursday. Price acceptance back into the lower distribution could target the session low at 2693.50, which was also very mechanical at just a single tick above the overnight low.

If price opens within the upper distribution, potential balance scenarios could include:

– Look above the upper distribution high at 2726.25 and find acceptance back into the upper distribution from Wednesday, potentially targeting the excess single prints or the opposite end of that balance. The unfilled gap remains at 2755.25 from June 22nd.

– Probe above the upper distribution high and fail, returning back into the balance with the potential to trade lower to the opposite side and test Wednesday’s lower distribution.

– Look below the upper distribution low at 2715.75, testing the single print at 2714.00, and find acceptance back into Thursday’s lower distribution with good odds of targeting the point of control, and potentially the weak low.

– Look below the upper distribution low and fail to find acceptance back below 2714.00, returning back into the upper balance and potentially targeting Thursday’s high, and the upper distribution from Wednesday.

– Remain in balance.

Whenever price re-enters a previous balance the same rules could apply – look either above or below the balance and accelerate or fail, or remain in balance. So the same trading scenarios exist if price opens within the lower distribution after the overnight trading session.

The overnight high and low are always valid trading references.



(the above, post and all posts on es-traders.com, is an interpretation of market generated information using the Market Profile, and the information contained within is to be used for informational purposes only and not to be construed as investment or trading advice. DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS WEBSITE. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. Please read our disclaimer)

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Balanced Inside Day Following Selloff

balanced inside day
Balanced inside day following priors day’s selloff

The late rally high from the prior day’s trading session was ignored as the market balanced inside the previous range, leaving a poor, no excess high at 2735.25.

Rallying from two ticks above the prior point of control at the third (C) period low, Tuesday’s value area ended the day as slightly overlapping to higher and the point of control had also migrated slightly higher during the day.

Potential scenarios could see price look above or below the one day balance and either accelerate/find acceptance at higher or lower prices, look above or below the balance and fail – potentially targeting the opposite end, or remain within or slightly extending the balance.



(the above, post and all posts on es-traders.com, is an interpretation of market generated information using the Market Profile, and the information contained within is to be used for informational purposes only and not to be construed as investment or trading advice. DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS WEBSITE. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. Please read our disclaimer)

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Markets Sell Off to Begin the Week – Fear of Possible Trade Wars Finally Sink In

large gap lower
large gap lower to begin the week

Often large gaps that begin a new week develop into a new short term trading range. Large gaps are also rarely filled the day after they are created.

market profile rally high
Split view market profile chart shows late rally high following early selloff

The late rally high at 2725.00 could be an early Market Profile trading reference on the next trading day. Continued acceptance below that level keeps the current downtrend in tact. Acceptance above the late rally high targets the excess single prints above 2732.00, and potentially test the prior monthly high at 2745.25. The session low, at just two ticks above the psychological 2700 level, is also very questionable.



(the above, post and all posts on es-traders.com, is an interpretation of market generated information using the Market Profile, and the information contained within is to be used for informational purposes only and not to be construed as investment or trading advice. DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS WEBSITE. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. Please read our disclaimer)

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