ES – Lower Value Areas Developing Below All Time High

ES lower value areas off all time high
ES lower value areas developing below all time high

After a breakout from the previous inside week’s balance to new all time highs on Monday, price reentered the prior week’s range on Tuesday and Wednesday, one timeframing lower on the daily chart from the recent new all time high at 2351.50, although still one timeframing higher on the weekly.

Price would have to trade below 2416.25 to stop the weekly onetimeframing higher. The long term trend is still up, as price has not stopped one timeframing higher on the monthly chart.

split view profile with mechanical selling at bar highs
Split view Market Profile chart with mechanical selling at bar highs

Wednesday’s regular hour trading session closed the gap from June 16th, as price traded down to 2428.00, leaving questionable price levels in the profile – clusters of 30 minute bar highs in D,E,F and G periods, and another cluster at the K,L,M,N highs, all trading very mechanically within 1 tick of one another leaving no excess. Mechanical trading suggest that the selling was done by shorter time frame traders, leaving good odds of those price levels being revisited, potentially to run the stops above.

The point of control has migrated lower intra-day the previous two sessions, along with developing lower value.

Wednesday’s profile also left a poor low at 2428.00 with only one tick of excess. Poor highs and lows also have high odds of being revisited, or repaired.

Wednesday’s 12 point session was balanced, therefore, depending on where price opens on Thursday, balance trading scenarios could apply on Thursday:

– Look above Wednesday’s high at 2440.00, stopping the daily one timeframing higher, finding acceptance and testing the prior weekly high at 2442.00 and prior all time high at 2443.50.

– Look above Wednesday’s high at 2440.00, stopping the one timeframing higher to let inventory rebalance, but failing to find acceptance and return back into Wednesday’s range. Price acceptance back inside Wednesday’s balance could target the opposite, lower end and poor low at 2428.00

– Look below Wednesday’s low at 2428.00, repairing the poor low and accelerating/finding acceptance at lower prices

– Look below Wednesday’s low at 2428.00, repairing the poor low and returning back into balance, repairing the weak references and potentially targeting the opposite end of Wednesday’s range.

– Remain in balance

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