Tag Archives: overnight low

Mechanical, Slow Paced Trading Session in ES

With overnight inventory virtually 100% short going into Friday’s pit session, the ES opened with a small gap lower (1 1/2 points), quickly filled the gap at the previous day’s low and pulled back to the Oct. 17th pit close at 2123.25 – which was also just one tick below the the overnight low and two ticks above the Oct. 17th prominent point of control, a very visual, mechanical short term trading level.

es-look-below-of-bbalance-and-fail

Very prominent, unrepaired points of control in the market profile often act as magnets for future trading sessions.

Friday’s pit trading session was a grinding, slow paced, low confidence session that traded off of very visual short term trader references, including:

  • The low of the day was just one tick off a previous close/point of control
  • The B period low was just one tick above the session open
  • C period initially stalled at the 2131 overnight halfback level
  • The I period pullback was from the then-current half back level
  • The L period high of day stopped just one tick short of the previous day’s pit close

Because it was at such a mechanical level, Friday’s high at 2136.75 has good odds of being tested on Monday. Acceptance above that level could see price test the Oct. 20 high at 2141.25, the Oct. 19th 2142.50 poor high and the Oct. 14th 2143.25 high. Hitting stops above those similar price levels could potentially see price fill in some of the single prints left from the October 11th selloff, and even possibly fill the Columbus Day gap at 2156.25.

The ES is one timeframing lower on the daily chart for three consecutive day sessions. Failure to trade above 2136.75 keeps the one timeframing in tact.

Friday’s profile also left multiple anomalies. That information can be carried forward as anomalies are structural weaknesses often created by emotionally driven traders, such as short covering, and have good odds of being repaired in the next or future trading session after they were created.

To the downside, the B period low – one tick above Friday’s open – also has decent odds of being retested.

The unrepaired poor low still remains at 2117.75.

(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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Calm before the upcoming Brexit Storm?

twelve-point-S&P-trading-range-within-overnight-session

Early trade Tuesday in ‘A’ period (the first half hour trading period on the above S&P chart) stopped exactly at the base of the spike from Monday, which also coincided with the overnight high and overnight session’s half-back level, very mechanical day and short term traders references. Price sold from there down to just a tick below the overnight session low, another very mechanical, visual trader’s reference.

Tuesday’s trading day was contained within the 12 point overnight range from Monday, forming a very prominent point of control at 2079.50. It is also another inside day, trading completely within the previous day’s range.

Being another inside day, possible trade scenarios (again, barring another gap open) for the next trading session would be for price to look outside of either end of balance and accelerate, or look outside and fail, returning within the balance. If look outside of balance and fails the destination trade is the opposite end of the balance, and potentially beyond. Any breakout of balance should have better odds of follow through if price first visits the very wide point of control from Tuesday at 2079.50 and then reverses.

There is also the possibility of price staying within balance, but with the upcoming Brexit vote that might be the lowest odds of the scenarios. Existing Home Sales and Federal Reserve Chair Janet Yellen’s semi-annual testimony before the House Financial Services Committee are also scheduled for 10:00 AM EST Wednesday, followed by the EIA Petroleum Status Report at 10:30 AM EST, each of which could cause volatility.

Calm before the brexit storm?

On Thursday, June 23 The United Kingdom will decide whether the U.K. will remain a part of the European Union. Polling results will be reported throughout Thursday’s U.S. trading day, with the official announcement expected to be released early Friday morning, June 24th.

Significant market activity is expected for later this week resulting from the Brexit vote.

More information on the upcoming Brexit referendum can be read here.

(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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