Tag Archives: gap fill

3/16 Gap Filled to the Tick – Another Poor Low and Poor High in Profile.

poor high and low in market profile chart

Another poor high and also a poor low in the profile chart. Large gaps are rarely filled the day they after they are created, Tuesday’s low did not fill the gap from 6/1.

Momentum trading off of very visual price references has carried the market higher increasing the odds of short term liquidation breaks. Tuesday’s high was exactly at the low from 3/16, very mechanical.

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Market Profile “B” Formation

Price opened within the previous day’s trading range in the S&P emini futures Tuesday, the A period high mechanically traded to just one tick below the prior days close, B period took out the A, but failed at one tick below the overnight halfback, the mechanical trade continued. Price was not acceptance above Monday’s close/prominent POC Tuesday.

market-profile-b-formation

The B period high reference, 2145.75, can be carried forward for future trading sessions as it can be considered to be a weak high – price reversing at such a visual short term trader’s reference. Visual short term traders references like this have good odds of being revisited either later the same day or in a future session.

A break in C period, selling off from the prior week’s high, filled Monday’s gap. There was heavy futures volume at the 2137.25 level. D formed inside bar, E looked above it, filling the A period single print and preventing the double distribution, but reversed at the session’s halfback level/previous low, more evidence of short term traders controlling price action and trading off of exact references. The remainder of the session chopped around in a balance, forming a wide point of control at 2138.75.

Wednesday’s profile has the classic “b” formation, implying the market was too long in the short term. Opening below and not finding acceptance back above Tuesday’s POC could easily see price test Tuesday’s low at 2135.25, acceptance below that level could target the multiple anomalies in the profile from Oct. 21st, along with that day’s low at 2123.25. There still remains the unrepaired poor low from Oct. 17th at 2117.75.

Opening below Tuesday’s point of control on Wednesday could see price gravitate back up to 2139, immediate resistance references above the POC include the prior weekly high at 2142.50, trading range high at 1143.25 and Tuesday’s high at 2145.75 – which can be considered a weak reference as it was just one tick below that session’s overnight halfback level. Above that is the weekly trend line, which if tested on Wednesday should be at the 2155 area.

(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. Please read our disclaimer

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