Tag Archives: double distribution

Two distributions, probable short covering rally

Anomalies in the market profile chart are often repaired, or traded back through, soon after they are created. Wednesdays balance and Thursdays rally traded back through the multiple anomalies in the profile following the April 24th selloff. Thursday’s (4/26) market profile chart also left a poor high at 2675.50, closing just off the high of day.

short covering rally

Depending on where price opens in regards to areas of balance, potential trading scenarios could include:

– Look above or below a balance and accelerate/find acceptance

– Look above or below a balance and fail, targeting the opposite end

– Remain in balance

Prior wide “naked” (not yet revisited) points of control can act as price magnets, often drawing price back to them. There are very prominent points of control both above and below Thursday’s range.

market profile daily charts

Focusing on the two separate distributions in Thursday’s profile, price acceptance within the upper balance would probably have decent odds of repairing the poor high, and potentially re-testing the high from 4/24, and if the market remains strong price could target the upper excess single prints from the 4/20 profile.

Carrying past information forward, the high from 4/19 at 2703.50 was mechanically just a single tick shy of filling the gap from 4/18, and the very wide naked point of control from the 4/18 profile at at 2714.00 has not been revisted. The prior weekly high is at 2718.00.

split view market profile chart
Split view market profile chart 4/26/18

If price opens in or finds acceptance back inside Thursday’s lower distribution, below the pull back low at 2663.75, the lower excess single prints in the profile could be tested, followed by the small gap at Wednesday’s high at 2645.00. Acceptance back into the 4/25 range could target the 10 TPO wide naked point of control at 2629.50.



(the above, post and all posts on es-traders.com, is an interpretation of market generated information using the Market Profile, and the information contained within is to be used for informational purposes only and not to be construed as investment or trading advice. DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS WEBSITE. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. Please read our disclaimer)

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Double Distribution, Wide POC

market profile double distribution

If price opens within this range early focus could be on acceptance or rejection of the separate distributions.

Price acceptance below Friday’s low could target the prior weekly low, as Friday’s liquidation break could equate to a failed break out of balance to the upside.

If price reenters a prior distribution the potential exists to reach the opposite end of that balance. If price does re-enter the upper distribution the excess single prints could be tested. Acceptance back above 2694.75 could target the 4/19 high at 2703.50, which could be considered a weak reference, as price traded to just a single tick below the 4/18 low following a small gap opening lower.



(the above, post and all posts on es-traders.com, is an interpretation of market generated information using the Market Profile, and the information contained within is to be used for informational purposes only and not to be construed as investment or trading advice. DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS WEBSITE. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. Please read our disclaimer)

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Double Distribution, Inside Day



Double Distribution, Inside Day
Double Distribution, Inside Day.

Wednesday morning is the release of the US CPI data, which could bring more volatility. A higher number could pressure stocks, a lower number could boost stocks.

Early focus could be on price acceptance in regards to each distribution from Tuesday’s profile, with potential balance trading scenarios applying:

Look above or below a distribution and either find acceptance and developing value at the higher or lower prices, or look above or below a distribution and fail, returning back into that balance and targeting the opposite end.

With the recent market volatility, eemaining within a distribution for a considerable period probably has the lowest odds. Tuesday was also an inside day, a large move away from either side of the range is possible.

From ForexLive.com:

Tomorrow at 8:30 AM ET/1330, the US CPI will be released. With all the focus on inflation since the US employment report, this will be a key release for rates, stocks and the dollar as well. If it moderates, it could go a long way toward easing fears about the inflation scare, 3 or 4 tightenings in 2018 and the stock market concerns. Conversely, if it surprises to the upside, the higher yields, lower stocks and 4 tightenings will be back in play.

The expectations are the following:
CPI MoM 0.3% vs 0.2% last month
Core CPI MoM 0.2% vs 0.2% last month
YoY for CPI is expected to decline to 1.9% from 2.1% last month
YoY core is also expected to decline to 1.7% from 1.8% last month.

Recent History Of This Indicator
Inflation may be under new scrutiny but one place it has been hard to find is in consumer prices. And not much price traction is expected to appear in January’s report with the core rate (less food & energy) seen up a modest 0.2 percent with the year-on-year expected to fall 1 tenth to 1.7 percent. The consensus for the headline CPI is a gain of 0.3 percent for a yearly rate that is also down 1 tenth, at 2.0 percent. ~
econoday.com



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