Market Profile - Daily updates

[CJS]

10/14/15 Recap and prep (for 10/15). Today was difficult for me to ascertain what the competitors were doing. Examples: periods D, E, & F highs could not breach each other. Once G period opened, we had a rally almost to the open. At this point I was confident the attempt to auction below the 1989 level I have been watching had failed (I guess it did for a short time). Moving on, 'I' period opened and I interpreted the two ticks it created below H period lows, was a look below and fail I went long. That was short lived. The high in J was a total head fake as it happened very quick (up and down). From that time period on, the sellers prevailed.
We are left with a poor low and sitting right on top of the previous 30+day balance bracket upper extreme.
Price, value and the TPO POC migrated lower, and the mkt is between two important levels as Im seeing it. That is 1982 and 1989.
We have had the cessation of 1T.F. higher confirmed with todays session.

Some conflicting info to carry fwd:
******* Positive ******
1) Above the 30+day balance bracket
2) Short term trend is still to the upside
3) The last two days appear to have been liquidation vs. new sellers taking positions (w no new shorts, once the liquidation/ inventory adjustment is over, the longer term direction is resumed, usually quickly). Longer term in context of the past 2 weeks of trading (being up).

******* Negative ******
1) Two poor lows now (1982.50 and 1962.5
2) Open gap remains from 10/5 (w such low confidence in the mkt I wouldnt be surprised if the mkt makes an attempt to close it at some point
3) Over all confidence in the mkt is low

 

[CJS]

10/15/15 Morning update. Good morning. Overnight trade is within yesterdays range, balance. Balance trading rules apply today. O/N Inventory is 100% long. Reaction to 0530 economic news this am has the ES (and all other majors) coming off a bit.

O/N High 2000
O/N Low 1985
Prior pit high 2001.75
Prior pit low 1982.50
Settle 1984.25
Volume 220K as of 0550am PST

 

[CJS]

10/15/15 Recap and prep (for 10/16). Over the last two days trade, the profiles had several anomalies - formed by emotional selling (or buying for up days). Yesterday, the profile shape was looking like the 'b' pattern and had a poor low. All of these clues were telling me that the selling was indeed that of emotional trading, not new money selling. Traders liquidating longs as the market was very stretched out. The 'b' pattern is an indication of traders liquidating longs and this selling being accumulated by longer time frame traders expecting to take these new longs home overnight. Nothing is in stone. But this is a common pattern and it all has to be taken into context. The overnight trade being 100% long and the failed test of the 1989 level (mentioned in other posts) in the early session provides evidence of everything mentioned above. This test was in 'E' period and left 5 ticks of excess and a nice buying tail. I'll admit, the trend today caught me way off guard. I was short going into the low, I missed the tell on the buying tail and how yesterday was the 'b' pattern. It was looking like today was going to continue to the downside.

Today had 3 distributions in the profile (distributions are separated by single prints). This is rare. Structure is weak as a result. Value and the TPO POC did not migrate with price.
However, 1T.F. overrides the migration of the TPO POC as well as value. From G period into the close we never stopped 1T.F. Evidence of at least day timeframe confidence.

Tomorrow may be a rotational day as the mkt tries to absorb today's bid action. I will be watching the Sept FOMC 2011.75 high closely. Any acceptance below this may confirm the excess high we have today. Excess indicates the end of the auction. However, should price be accepted above and beyond the the 2011.75, the next auction could also be a continuation of the recent bid activity.

 

[tandh]

Have you offered a premium service yet?

 

[CJS]

Have you offered a premium service yet?

Not yet bud but when I do I'll have a special price for you. Proceed.

 

[CJS]

10/16/15 Morning Update. Good morning. Overnight trade has been centered around the high of yesterday and inventory is balanced. There's a ledge at the 2015 level (noted in the screenshot) that is being defended by bulls. I do not think this is by accident.
My go no/go level is the Sept FOMC spike at 2011.75. This level is also around the highs of 10/9-12-13. Should we trade and find acceptance below this level, the weak structure from yesterday's profile will not offer much support. Should this happen I will be watching yesterday's half back at 2004.50
To the upside I don't have anything that is reasonably close to where we're at currently as far as intraday is concerned.

O/N high 2023
O/N low 2013.75
Prior pit high 2019.50
Prior pit low 1989.50
Settle 2019
Volume 168K as 0600am PST

 

[CJS]

10/16/15 Recap and prep (for 10/19). A great day for those who were patient and saw what was unfolding throughout the am session. I'll explain the set up after recapping the day.

Today's attempted direction was down for the most part, with lower volume and higher value implies a strong mkt. We remained in the upper portion of yesterday's third distribution, further supporting the assertion of a strong mkt. At least, for now.

Today's profile left a poor high and a very prominent TPO POC. The 1989 level was defended very well today, as traders didn't even wait for price to hit it before buyers stepped in, in force.

Let's discuss what was unfolding:
Refer to the graphic for the following if needed.
1) Sellers were getting less and less for their efforts thru 'H' period. This is evident from the poor low in B/C period, and an even poorer low when G period added to it.
2) These efforts were causing two things to shape up in the profile, 1. A 'b' pattern and 2. A 45 degree angle. The 45 degree angle is drawn from the poor low to the TPO POC. These have to be taken into context how they are formed. The sellers getting less and less for their efforts over time formed it and combined with a 'b' pattern, a short covering rally at some point (didnt have to be today) has very high odds of materializing.
Once 'I' period repaired the poor low and 'J' opened it appeared we were going to sell off. However what happened was 'J' turned into a perfect buying tail and an asymmetric opportunity.
I overlay the Market Profile onto my methodology that incorporates a set of 3 non correlated indicators from emini-watch.com - without getting too techy about it, the low in 'J' registered an exhaustion sell and bullish divergence signal on my tick bar charts. These combined with the 45 degree angle and 'b' pattern gave me the confidence to go long on the way down at 2014.75, a loss of 1.5pts as my stop was two ticks below the O/N low. I got long again on the way back up at 2014.25 for 5 pts exit right below prior pit high.

 

[CJS]

10/19/15 Morning Update. Good Morning. Overnight trade currently trading within balance. If we open inside of Friday's range balance rules apply. Overnight inventory is pretty short. There is still a poor high from Friday too. Overnight traded above it but only RTH counts as repair. Over the weekend I noticed that the Sept FOMC high 2011.75 is also Sept monthly high. This makes the level more important and should be your downside reference for today.

O/N high 2028
O/N low 2017.50
Prior pit high 2026
Prior pit low 2012.25
Settle 2025.75
Volume 148K as of 0545am PST

 

[CJS]

10/19/15 Recap and prep (for 10/20) Attempted direction was up w lower volume and overlapping to higher value is evidence of a balancing and slowing mkt. Excess and balance are two most important things to consider when looking at the market through the lens of the Market Profile. Friday and today has had some meaningful excess on the lows. Excess marks the end of auction. It's obvious the lows are being bought up by more than just day timeframe players. The highs are not as clean. Friday we had a poor high (among other things it indicated that the upward auction was not complete). Today's action repaired the poor high and also ended the day with a mere 3 ticks of excess. Not as clean as the lows. All items are supporting factors for a continuation to the upside.

 

[CJS]

10/20/15 Morning update. Good morning. Overnight trade is in balance, balance rules apply for today. Looking at the RTH and O/N trade over the past few days value has been migrating up. This is positive to continuation to the upside. On the contrary, this mkt is very stretched out. It would be wise to keep expectations in check.

O/N high 2027.25
O/N low 2019.25
Prior pit high 2027.75
Prior pit low 2014.25
Settle 2027.75
Volume 118K as 0545am PST (light)