ES Lower Value, Anomalies in Profile

Overnight inventory was 100% short from the previous day’s close heading into Wednesday ES pit session. A gap lower open repaired all of the anomalies from the Oct. 21st poor structure profile, including the weak B period low reference from that day where short term traders rallied off the opening price.


There was no immediate correction to the short overnight inventory as the opening period high traded to just two ticks below the overnight halfback level, a visual short term traders reference, and reversed five points.

After forming an inside balancing bar in B period, the ES once again followed crude’s lead and rallied in C period off the EIA petroleum status report, trading into the prior day’s trading range and through the previous close, correcting the short overnight inventory.

Market Profile split view:


But with no real acceptance above Tuesday’s wide point of control and the short covering completed, a break lower in H period below the prior low sold off to the floating half back level. The selling continued through I period with price reentering the lower distribution and first period initial balance. Crude oil also reversed from its high, the two markets were again trading in tandem.

Price bounced from a tick below the opening price in J period and one timeframed higher for the remainder of the session, but was not accepted back inside the previous day’s range.

If the market opens within this erratic range on Thursday it would probably be a good idea to let it shake out before entering a trade, as the odds could favor early chop. Wednesday’s J period low off the open print and L period late rally high at the prior low (both very visual short term references) can be considered weak and probably have good odds of being tested. Acceptance above 2136.00 could target Wednesday’s D/E period poor high at 2140.00.

The ES is trading in a wide, multi day balance. Be aware of the potential of a “firecracker effect”, if price can accelerate through Wednesday’s low there exists the possibility of stops being hit below the similar daily lows at 2124.75 and 2123.25. The unrepaired poor low also still exists from Oct. 17th at 2117.75.

(the above post and all posts on 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. Please read our disclaimer

Share  Facebooktwittergoogle_plusredditpinterestlinkedinmail


Leave a Reply