Tag Archives: point of control

Bell Curve Profile – The market is long on poor structure, risk to longs is high

After the second consecutive gap open higher, price tagged the overnight high at 2797.75 to the tick and struggled to find acceptance above the June high at 2796.00.

 bell shaped curve in Market Profile chart
Near perfect bell shaped curve in Market Profile chart

Tuesday’s profile, just a 9 1/4 point trading range, was a near perfectly balanced market profile bell curve. The profile chart shows a very prominent point of control at 2793.75 and a no excess high (three TPO’s wide) at 2797.75, which was also the overnight high coming into the day trading session.

If the market gaps open higher again on Wednesday it would be unusual to have three consecutive gaps, and the risk to longs would apparently be very high as recent underlying market structure is also very poor following the prior week’s end rally.



(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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Balance Following Rally, Leaves Questionable High



balance following short covering

The ES closed just above the high from Friday’s emotionally driven short covering session, leaving a questionable high in Monday’s profile at just a tick below the high from 4/30. There are now four closely grouped daily highs between 2681.50 and 2683.75 dating back to 4/23.

Monday’s wide POC could draw price back to it on Tuesday. Acceptance above the prominent point of control could target the weak highs, trading above the highs could potentially trigger stops above that area. The potential could also exist for a “look above and fail” of that area, or to remain balanced (probably the lowest odds).

Acceptance back below the POC from Monday targets the close (CME settle at 2670.00) and could test the low at 2662.50. There are multiple anomalies in the profile from the 5/4 rally in need of repair.

balanced profile



(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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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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