Going into Thursday’s U.S. pit session, overnight inventory was 100% long as the Globex low was exactly at the 4:15 ET close of the previous pit session. The market opened near the middle of the previous day’s range, two ticks below the overnight high.

Short term traders were evident early as selling came from half back levels intra-bar in A period, but buyers were waiting below as price bounced from a tick above the overnight half back level at the top of the Globex lower distribution, a very visual short term traders reference.

Price rallied to Wednesday’s point of control in B period, formed a small, balancing inside bar in C, before accelerating higher in E an F repairing the anomalies and the weak, mechanical high at 2349.25 from Wednesday’s profile (weak because it was one tick shy of the April 12th high), also repairing the poor high (one tick of excess) from April 11th at 2352.75.

The market one timeframed higher from the opening period until K period, developing an anomaly between 2348.25/2349.00, and a larger distribution above 2351.00.

Looking at each distribution as a separate balance, balance trading rules could apply to each on Friday: look either above or below a balance and accelerate or fail – on failures the opposite end of the balance becomes the potential target, or remain in balance.

Thursday’s pullback low at 2351.25, two ticks below the close, could also be an important early reference on Friday depending on where price opens. Not finding acceptance back below that level should technically keep Thursday’s uptrend in tact.

While Thursday’s rally appeared to be strong, NYSE daily volume still did not suggest strong market participation from the longer timeframe. The first half hour NYSE volume was under 300k. End of day NYSE volume was higher than the previous day at 3.64 billion, with a late spike near the close.

Carrying forward Thursday’s mechanical low, just one tick above the overnight half back level, and the D period low within a tick of the opening price and overnight high, what potentially occurred on Thursday were well capitalized short term traders putting the squeeze on the shorts.

With the upcoming French Presidential elections beginning on Sunday, and remembering the unpredictable reactions the markets had to the U.S. election and Brexit, the coming days will probably bring a lot of uncertainty and volatility to world markets.

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