Tag Archives: one time framing

FED Day – FOMC Minutes Leaves Multiple Market Profile Anomalies

Fed-Day-multiple-anomalies-market-profile

Following Tuesday’s pre-FOMC Day, gap open lower and small seven point trading range (Tuesday ended the pit session as a near perfect bell shaped profile curve, but with both a poor high and a poor low), the ES opened Wednesday’s pit session at the lower end of Tuesday’s tight balance and quickly traded lower, taking out the three almost identical “weak” lows from Aug. 11, 12 and 16th.

D period eventually repaired the poor low from Aug. 10th but price failed to trade down to close the gap at 2163.50 left unfilled from Aug. 4th.

Wednesday’s profile left multiple anomalies. Some, or all, anomalies in stretched out profiles are often repaired in future trading sessions soon after.

Currently, there is excess on the all time high at 2190.75 on the daily, weekly and monthly bar charts. There is no excess on the market profile pit session chart because it is a “poor high” at three TPO’s wide. Poor all time highs can last for sustained periods of time but history has shown they are eventually repaired.

While the monthly bar chart has resumed one timeframing higher the weekly and daily bars have not. An immediate short term market profile reference for Thursday could be Wednesday’s poor high at 2181 (which was also the exact overnight high). If taken out, one timeframing on the daily chart will have stopped. If not, some or all of Wednesday’s anomalies could be repaired and price could possibly test Wednesday’s low.

Potential targets above Wednesday’s high include Tuesday’s poor high, the unfilled gap from Aug. 15 at 2184.50, and the all time high.

It would also not be uncommon for the market to trade above the previous day’s high, temporarily ending the one timeframing lower and allowing short term inventory to balance, then trade back into the previous day’s range and continue one timeframing lower.

(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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Double Distribution Trading Day

After grinding its way higher to take out the latest Globex all time high by two ticks before one timeframing lower for 6 periods on Tuesday, Wednesday’s ES pit session opened slightly above Tuesday’s close and chopped around in a 5 point range for three periods before breaking to the downside in D period, forming a double distribution and filling in some of the excess single prints from August 5th.

market-profile-double-distribution

Both value and the point of control migrated lower during Wednesday’s session.

So was Tuesday’s grind higher to take out the Globex session all time high and establishing a new pit session all time high “game over, side out” for the market participants who drove price up there? Will this latest new all time high be lasting, at least for a while? Only time will tell.

For Thursday’s U.S. trading session, market profile traders will want to monitor for price acceptance or rejection around the two distributions from Wednesday, and poor low at 2167.75.

Acceptance below the lower distribution could target the unfilled gap and prominent point of control from the August 4th profile. Trading with acceptance back into the upper distribution targets Wednesday’s high and could challenge the all time high from Tuesday.

(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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Breakout of Balance or Just A Liquidation Break?

Early in the opening “A” period on the Market Profile chart Tuesday, price tried to again rally exactly off of the previous day’s low at 2159.75, but failed exactly at the overnight half back at 2164 (indications of more short term traders buying and selling off of exacting price references?) and reversed back through Monday’s low.

Momentum traders piled on, one time framing lower for the first 8 market profile periods repairing the poor low from July 28 and the matching daily lows from July 19 and 27.

breakout-of-balance-s&p-emini

After leaving many single prints from the A and B periods selloff the market tried to balance, printing two inside bars in D and E periods, and developed a 5 wide POC by G period at 2147.75.

Still one time framing lower the market traded below that balance, leaving a poor low at 2141.50, short of filling the first of three gaps below the market at 2136.75.

Probable short covering began in J period with the market one timeframing higher for the remainder of the session, but price could not get back to the day’s half back level and closed the session at 2153, the late day rally high.

There is only 4 ticks of excess on the monthly bar at the all time highs. In addition, the latest all time high now at 2177.75 was made in the extended hours trading session.

At just 3.8 billion, NYSE volume was not particularly high in comparison with the size of Tuesday’s move down.

Focusing on Wednesday, IF price opens within the lower distribution from Tuesday’s profile, will price attempt to trade with acceptance back above the late day rally high at 2153 and fill in some of Tuesday’s A/B single prints (and reenter the multi-day trading range), or will selling pressure continue and pull price back down in attempt to repair the 2141.50 poor low, and the unfilled gap from July 11? Another possibility would be for the market to stay in balance with Tuesday’s lower distribution.

There was no continuation late with Tuesday’s selloff. If more serious money was selling price probably shouldn’t have reversed so much off the lows, and NYSE volume should probably have been higher. But if Tuesdays selloff was a true breakout to the downside and not a liquidation break from shorter term traders, will Wednesday open with a gap lower? If it does, monitor if price gets accepted or rejected back within Tuesday’s lower balance.

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