Market Profile - Daily updates

[CJS]

10/07/15 Morning Update. Good morning! The main focus for me today is if we can trade above or below this 1981.75 level. Above it, could attract longer term money as we would be clear of the 30day balance we have been in. Which, may or may not turn into a trend day to the upside. Trading below, well then there is no real change. Targets to thew downside that I have written down are:
1) Very prominent TPO POC 1971.50
2) Prior pit low 1962.50
3) O/N low 1960.50
4) Pit low 9/10 1955.25
5) Gap fill 1943.75

I've posted a screen shot of the stop run overnight when traders got price above the 1981.75 level. Pretty cool stuff.

Prior pit high 1982.25
Prior pit low 1962.50
O/N high 1985.50
O/N low 1960.50
Settle 1968
Volume 237K as of 0545am PST

 

[SuzieSixSpeed]

do you see any significance from the higher volume we have seen lately and the very high volume we saw during the first 30 minutes today?

 

[CJS]

do you see any significance from the higher volume we have seen lately and the very high volume we saw during the first 30 minutes today?

Tom Alexander has said and makes total sense; it's so hard to gauge on volume alone what's going on. Because, the volume comes from so many different players. The sells, could be longs liquidating, one leg or two of an option spread. Same goes for buys. I wouldn't consider vol today in the first 30 very high. It was around 480K. I've seen it upwards of 600K at times, this is significant to me. Hope this helps.

 

[CJS]

10/07/15 Recap and prep (for 10/8). I think it's safe to say we have a short term trend to the upside. The last 5 of 6 days have been up days. 1T.F. higher for 6days now. Closed above the balance bracket high of 1981.75. Goes without saying, staying above this level is positive and will be evidence of a reordering of the markets thinking. Today left a poor low. Carry this event forward.

I've been eyeballing a Globex level on my ToS charts (24hr Daily). This level is the 1989 level. With this in mind, let's talk profile:
'A' period traded a tick below this level, B opened and traded through it only to find failure. Sellers stepped in and drove the market down to the very prominent POC from yesterday. We had a 2.5 handle bounce from this level then selling resumed and price was taken to the settle from yesterday (1968). It's so hard (at least for me) to tell exactly what's happening when it happens. But hind sight reveals that this selling was an inventory adjustment from the overnight session, as inventory was 100% long coming into today's session. From this point on, I believe that buyers from multiple time frames stepped in and took the market all the back to --- yep, exactly to 1989, the Globex level. The collapsed profile shows this very well. Jim Dalton always says, a market has to break before it can rally. I think today was an example of this, and shaking out the weaker longs.

The market short term is still very long. The last two attempts to auction outside of the 30 day balance bracket (1 to the upside, and 1 to the downside) have failed and the opposite extreme was reached. Keep this very important piece of data in your mind.
Sketchy area to be in right now, keep a flexible bias.

 

[CJS]

10/08/15 Morning update. Good morning. Trading within balance overnight. Balance trading rules apply. The mkt is currently trading back into the 30+ day balance bracket. (Below 1981.75). A couple things to keep in your mind during today's trade.
1) There is a poor low left from yesterday. The mkt may revisit this level to repair it.
2) FOMC minutes at 11am PST. There will be volatility after this event.
Overnight inventory is net short but not 100%.

O/N high 1989.25
O/N low 1971
Prior pit high 1991.25
Prior pit low 1967.50
Settle 1987.25
Volume 219K as of 0545am PST

 

[CJS]

10/8/15 Recap and prep (for 10/9). FOMC data was received as positive for traders as we had a spike up to 2008.75. I'm viewing the spike base as the 1989 level. Spike trading rules are as follows:
1)Opening and remaining above spike. Very positive and suggests that the latest auction had not gone high enough to cut off the buying.
2) Opening and remaining within the spike tells us that the spike was accepted; this would also be seen as positive as value would be developing higher.
3) Opening below the spike or opening within the spike and quickly trading down below the base of the spike is negative telling us that the auction had gone high enough to attract sellers.

I dont much use moving averages in my trading. But the 200Day I know attracts alot of attention when traded around. Ive posted a ToS Daily 24hr chart for your review.
The nearest upside target if we continue to auction higher tomorrow is the pit high from 9/17 at 2011.75. Beyond that, I struggle to find some structural target traders may shoot for. The 200Day at 2055 seems to be what traders may target.

However, the market short term is very stretched out. I would not be surprised if we have a rotational day as days after FOMC seem to be a day of digestion. Another piece of market generated info Im looking at is that value and the TPO POC remained in the lower portion of the range from today indicating that the market today got itself very long.

 

[CJS]

10/9/15 Morning Update. Happy Friday! Overnight inventory is long but not 100%. Inventories are adjusted when the mkt trades back to the settle. Overnight trade has remained in the upper portion of the spike (positive). Currently trading a gap of a handle or so. If the gap holds into to the open apply gap trading rules. Recall the spike trading rules from the recap yesterday, apply those should we begin trading back into yesterday's session. Some possible targets to the downside are:

1) The Globex high of 1989
2) O/N low 1998.75
2) TPO POC 1984.75
3) Prior pit low 1978.75

O/N high
O/N low 1998.75
Prior pit high 2008.75
Prior pit low 1978.75
Settle 2007
Volume 203K as of 0545am PST

 

[CJS]

10/9/15 Recap and prep (for 10/12) I believe the attempted direction was down today. That being said, lower volume and higher value indicates a strong mkt in terms of directional performance. We also remained in the upper portion of yesterday's spike, very positive. Today left a poor high with an attempt to auction above the spike high from the Sept (9/17) FOMC day at 2011.75 (poor high is 2012.25).

We also have an open gap from Monday. With the continuous 1T.F. higher all week, and how the sellers didn't get much at all for their efforts in today's session (we spent 5 periods in two-sided trade in a 5 handle range), I would like to categorize the gap as a 'Break-away gap'; a Break-away gap occurs when the market is in the early stages of a long-term trend.

However, we are very stretched out, and volume is declining on a daily basis. We'll need more volume to hold these prices up and higher. It's very possible that longer term players have been participating to carry the market from the look below and fail (1861.50 from 9/21) of the 30+ day balance bracket, all the way to and through the upper extreme which was 1891.75, to today's high. I do not believe day and short term players could carry the market this far especially when it's been locked in a range for over a month. Just my .02
Have a great weekend!

 

[CJS]

10/12/15 Morning Update. Good morning. Holiday trade day. Volume is extremely light as a result: 92K as of 0550am PST. Trading within balance. Balance rules apply. O/N inventory is well balanced. Keep in mind we still have a poor high from Friday's trade. Don't mistake it's repair as a break out unless it's followed by supporting volume, and price acceptance - trading rules cover this.
There will be no recap today. I'm going to the Chargers vs. Steelers game today!
Trade well.

O/N high 2012.5
O/N low 2001.75
Prior pit high 2012.25
Prior pit low 1998.75
Settle 2006.75

 

[CJS]

10/13/15 Recap/morning prep for 10/14. Opened out of balance to the downside and rallied through (10/12/15) range with a look above (prior two day balance and the spike high of 2011.75 from the Sept FOMC day) and fail. Sellers stepped in and the mkt liquidated the rest of the day closing on the lows. Value ended up being OL lower. A poor low was created and left a few anomalies. This indicates the selling was more short term liquidation than new sellers stepping in. Inventory on a daily basis has been long and the mkt stretched out.
O/N trade has been balanced and I don't think it's a coincidence that it couldnt get below (matter of fact, 1 tick above) the Globex level of 1989. O/N activity following an outside day is generally higher and we have not seen that. What doesn't happen is very often more important than what actually happens.
I'm interpreting this as follows; if the O/N low cannot be taken out, it may get the attention of buyers and the current short term uptrend may be continued.
We have a cessation of 1T.F higher with yesterday's session.

O/N high 1998.5
O/N low 1989.25
Prior pit high 2014.75
Prior pit low 1993.25
Settle 1993.75
Volume 197K as of 0545am PST