Opening within the prior day’s range, Thursday’s ES pit session delivered the expected early chop ahead of Friday’s jobs report. The opening period couldn’t trade more than two ticks above Thursday’s prominent point of control, and the first five market profile periods traded in just a 6 point range, developing an early wide point of control around 2093.00.

But when short term traders in the ES have nothing else to go on they’ll look for the easy trade, so following a sharp break lower in crude oil futures, momentum day and short term traders sold the market lower in F period, accelerating price through the weak B period low (weak because it was exactly off the overnight half back level), and formed a lower distribution.

With price not finding acceptance back in the upper distribution, the point of control migrated lower to 6 wide in K period at 2088.25. Value also crept lower.

Thursday’s profile, arguably, left three distributions – the late day spike in L period’s single print at 2085.00 was filled in the final 15 minute period after the closing bell, but price did not trade back above 2085 and into the middle distribution. Looking at each distribution as a separate auction, or balance, balance trading rules could apply on Friday – look either above or below each balance and accelerate, look above or below and fail initially targeting the opposite end, or stay in balance (lowest of odds).

An immediate reference on Friday, depending on where price is at the open, could be the late day spike base at 2085.00. Opening above that level could infer that the late lower price probe was rejected, and the market could gravitate back to the point of control, or fairest price, at 2088.25 and possibly test the middle distribution high at 2090.25. Price acceptance back into the upper distribution above the 2091.25 single print could potentially see a test Thursday’s high, the opposite end of the upper balance.

One Timeframing Lower

The market has been one timeframing lower on the daily chart for seven consecutive days, trading above 2097.75 would halt the one timeframing. If price can rally off the jobs data above Thursday’s high, the psychological 2100 level could come back into play. Acceptance back above 2100 could possibly see price make a run for Wednesday’s high at 2106.50, and eventually repair some of the anomalies above that level from Tuesday’s selloff.

But the ES is now trending lower on the short and intermediate time frames and is one timeframing lower on the monthly chart. Opening within or below 2085.00 infers the market had not traded low enough on Thursday to find a place where two sided trade could take place. If the market finds acceptance below Thursday’s low, the 2074.50 low from July 7th and 2058.50 pullback low from July 6th are potential destination trades to the downside.

Friday’s pit session should see volatility from the release of the monthly jobs data, and possibly residue from the WikiLeaks release of the latest Clinton emails.

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