Triple Witching – when stock index futures, stock index options and stock options expire on the third Friday of March, June, September and December, occurs next on Friday, September 21, 2018.
The ES broke out above the prior all time high at 2922.25 (ESZ2018) in the pre-market trading session, with the market profile chart forming a double distribution. The buying was very mechanical early, with the B and C period lows within a single tick of the opening price. Depending on where the market opens, the lower distribtuion could have good odds of being revisited.
Generally, in double distribution and multiple profile charts, each distribution could be looked as as a separate balance area. With just two ticks separating the two balances in Thursday’s profile, it probably lessons the significance of the double distribution.
Acceptance back into a prior balance area has the potential to trade to the opposite side of it. Rejection of a balance area also has the potential to reach the opposite end of the next distribution it re-enters (if accepted). Remaining in balance is also always a possibility, but more unlikely in narrower balances. Triple Witching Friday could bring added volatility.
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