Tag Archives: liquidation break

Early Liquidation Break Ends Weekly One Time-Framing Higher, Short Covering Late

early liquidation break, short covering late

Early selling at the open intensified as price repaired previous multiple poor lows on the daily Market Profile charts, but falling short of repairing the the poor lows from 10/9, 10/3.

Apparent short covering off the G period two-tick excess low rallied price back 17 points to one tick below the A period single print.

The selloff gained momentum after price broke through the prior three day balance low and bounced back exactly to that level and halfback from A period, suggesting the move lower was initiated by shorter time frame momentum traders.

The late rally high at 2558.75 could be an early important trading reference on Thursday, acceptance back above that price level and into the upper distribution probably targets Wednesday’s high and potentially the very prominent point of control from 10/24 at 2567.50, and the poor high from that profile at 2570.25.

Failure to find acceptance back above 2558.75 could keep the downward tone from Wednesday in tact. Price had stopped one timeframing higher on the weekly chart on Wednesday. For more potential serious change price would have to trade below a prior weekly low at 2539.25 and test the current October low.

Price has been one timeframing higher on the monthly chart since the November 2016 Presidential election, if it can close near the October low at 2517.50 by the end of the month the odds could be good that the monthly one timeframing would be challenged in November.

The current all time high was made in the overnight electronic session at 2577.25, something to carry forward as to date, any all time high made in the Globex market has always been traded through during a regular US hour trading session. Although, however, it can remain untested for quite some time.

(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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Failed Breakout of Monday’s Balance, POC Migrated Lower

With overnight inventory almost 100% long, the ES gapped open higher Monday. Market participants also got long off the open, there was no early correction to long overnight inventory.


Price repaired the 9/15 poor high at 2144.25 in A period, traded 2 points above it and the overnight high in B period but fell short of filling in the single print at 2147.50 from the 9/12 short covering rally. B traded lower and bounced exactly from the half back level, hinting that it was not strong buying in the market but more short/day timeframe traders.

Although value was developing higher on the day and a five TPO wide POC was developing at 2142.75, the pace of the session was very slow and volume was lower than the previous day. Carrying forward Monday’s wide POC at 2128.75 and poor low at 2123.00, long short term inventory combined with developing poor structure from the C/D/E bar lows suggested a liquidation break was possible.

When F period failed to trade above the E period high the market broke, trading through the C/D/E lows, probably hitting stops. Momentum traders piled on driving price lower, initially bouncing two ticks from Monday’s gap fill but trading through it in G period, forming a lower distribution.

Price reenterd the previous day’s range for a second time in H period accelerating lower through the previous close, overnight low and one point through Monday’s prominent POC, one timeframing lower in F, G, H and I periods before rallying/short covering off the low and Monday’s prominent POC.

K period closed the upper distribution, but the market sold again from the K/L high, exactly at the opening print, and closed back within the previous range.

Value ended the session overlapping to higher, but the POC migrated lower from an earlier five TPO wide 2142.75 to six wide at 2133.75.

Because the K/L period highs were exactly at the opening price, that level could be considered a weak reference and could have good odds of being tested on Tuesday (value did not end lower). But considering the market closed within the previous range after a gap higher opening, and the point of control migrated lower during the trading session, there are also good odds the market will test lower. Failure to find acceptance above Monday’s close and point of control could bring lower references in play, like Monday’s poor low at 2123.00 and beyond, as noted in Sunday’s Market Profile post.

If price is accepted above Monday’s close/POC, monitor developing value and one timeframing for continuation.

Comments Welcome!

(the above post and every post 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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New S&P 500 emini All Time High


After setting a new all time high during the overnight session, the ES gap opened higher on Monday, failed to reach the overnight high in A period by two ticks, sold off to fill the gap from July 8th by one tick in B period, then one timeframed higher for the next 5 market profile 30 minute trading periods, setting a new all time high on the S&P emini September futures contract at 2136.75.

More mechanical buying in J, K and L periods formed a three TPO wide selling ledge, which was breached late in the day in an M period liquidation break, but the 9 wide point of control at 2133.75 limited downside continuation.

Monday’s S&P all time high was achieved on low NYSE volume of 3.2 billion. Although value was clearly higher on the day, the mechanical nature of the earlier bounce off the previous day’s high along with the slow pace to the session was indicative of short term traders in control of the trading session.

July 8th’s stretched out profile left three single prints and multiple anomalies, structure that poor is often repaired in future sessions. Depending on how Monday’s overnight session trades and where price opens, the 9 wide POC could act as a magnet and also potential resistance during Tuesday’s pit session if price opens below it, being mindful of the L period rally high at 2135.75. Any trade that occurs above Monday’s high at 2136.75 during Tuesday’s pit session will be another new all time.


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