Monday’s regular trading session opened within the previous day’s elongated range but below the prior close, and below the late rally high from Friday at 2429.25.
The ES sold lower in the opening period to two ticks above Friday’s single print buying tail, mechanically selling at halfback intra-bar in A period and leaving a long line of single prints (over 8 points) – early clues that the early move lower was probably just a liquidation break rather than from larger time frame money continuing the selloff from Friday.
Although early ES volume was higher, and first half hour NYSE market volume was substantially higher at over 535,000 shares, price did not find acceptance into Friday’s single print buying tail.
The market balanced in less than an eleven point trading range on Monday, leaving a poor high at 2427.50 (no excess) and a very prominent point of control at 2422.00.
An early reference on Tuesday could be on the prominent point of control, as acceptance above that level has good odds of repairing the poor high. If price can also find acceptance above Monday’s high, odds suggest price would attempt to repair some of the anomalies from Friday’s range.
Balance trading rules could also apply on Tuesday, depending on where price opens: Look either above or below the high or low and either accelerate, or fail. A failure of an attempted breakout from the inside day could target the opposite end of the balance. Another potential scenario would see price remain balanced around Monday’s range ahead of Wednesday’s 2:00 PM ET FOMC Meeting Announcement.
Potential destination trades to the downside, if price breaks out lower, could include Friday’s low at 2412.20, the June 1st low at
2410.50 and the unrepaired prominent point of control from May 31st at 2405.25 (September contract).
There is now substantial excess at the all time high on the short, intermediate and longer term time frames, although the profile from the June 9th record high is a poor high, with only one tick of excess.
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