Market Profile Analysis of S&P Futures – 05.23.18…

Value Areas and POC figures for /ESM8 and /NQM8 Futures are posted free every morning HERE. Click on any posts in the list on the left pane to see them in the main window. Don’t click on the ST logo as it will just refresh the page and you’ll get only the topmost post over and over. Click on the title or text.

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Double digit gap to the downside today and slated to open outside of yesterday’s range. Gap rules apply.

Overnight inventory is 100% net short. Thus the early trade is to watch closely to see if there is a fade move. I believe the odds of this are pretty good as yesterday’s RTH close was on a spike and far from the value area and the POC. The ONL is at 2704.50; look for early trade to fail to take that out and then look for the possible counter move higher. As this gap is large, don’t expect that it has to fill all the way (gap rule #2). Overnight halfback is at 2715.75, which is very close to the prominent VPOC of 5/18. This could be a target for a fade.

If value starts to develop much lower, early, then by all means “go with all gaps that don’t fill right away” (gap rule #1).

In the bigger picture, the key downside level is 2700.50 which is the 5/15 low. This represents the low end of the balance area. Any acceptance below this level puts the current slightly bullish bias into question.

-peter