Tag Archives: point of control

Back to Back Inside Days, Matching Points of Control and Value Areas Form Two Day Balance

Friday’s regular trading session ended as an inside day, following the inside day from Thursday where price was contained inside the lower distribution from April 5. The point of control from both days is at 2354.00, and both session’s value areas are also identical. Friday’s profile left a poor low at 2347.00.

indise days, matching market profile points of control

If price opens within range on Monday, balance trading rules could apply in regards to the inside day and the two day balance:

  • Look above the two day balance and accelerate
  • Look above the two day balance and fail, and return back into the balance
  • Look below the two day balance and accelerate
  • Look below the two day balance and fail, and return back into the balance
  • Remain in Balance

The back to back point of control at 2354.00, or fairest price, could be early support or resistance if the market opens within the range, possibly providing clues to market direction.

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Market Sells Off From Inside Day, Short Covers Into Close

The ES opened near the lower end of Friday’s small range, inside day on the first trading day in April, immediately testing Friday’s low to within a tick at 2358. But after a low confidence, less than 4 point opening period price accelerated lower through the low.

Monday’s early selloff appeared to be a liquidation break from shorter term traders rather than from longer term money selling, evident by the short covering rally into the close.

Short term traders in control

An early bounce in B period off its low at 2352.75 up to 2357.75 went back exactly to Friday’s low, and the selling resumed from the C period high at 2358.00, just one tick above that level, a very obvious short term traders’reference.

Although price sold off sharply, accelerating through two consecutive daily lows and into the March 28th lower distribution, Monday’s low at 2340.00 was not re-tested, and a wide point of control began to develop at 2348.00, turning 8 wide by K period.

Depending on where price opens on Tuesday, Monday’s rally high at 2357.70 could be an important early reference. Opening and finding acceptance above 2357.50 nullifies Monday’s early downtrend, and price could gravitate back to the prominent back-to-back points of control at 2362.25/.50 and on its way to repairing the back-to-back poor daily highs at 2366.75, also the prior weekly high. Opening and finding acceptance below 2357.50 keeps Monday’s early downtrend intact.

The market has stopped one timeframing higher on the daily chart, and is still one timeframing lower on the weekly. Monday’s point of control at 2348.00 did not migrate higher with the late rally. If price opens below Monday’s close, early focus could be on price acceptance either above or below the point of control, and developing value.

Failure for price to find acceptance above Monday’s POC should see a test Monday’s excess single print buying tail at the low. A breach of 2340.00 could re-test the March 28th lower distribution/balance low at 2338.50 and the prior support level at 2332. If there is more serious selling below prior support, more extreme levels price levels could come into play including last week’s low at 2318.00 and the unfilled gap from February at 2312.75.

(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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