Market Profile Analysis of S&P Futures – 10.11.17…

Value Areas and POC figures for /ESZ7 and /NQZ7 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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Yesterday’s distribution showed a number of mixed signals. I fear that many of those newer to the profile will focus only on the excess high. Let’s look at all of the annotations on the market profile graphic above.

-The excess high was a legitimate excess high. It is even outside of range. A more “excessy” (not a real word) high would have tapered and not brought in four price levels of +10k volume. In this case, higher prices attracted buyers at the new highs.

The excess high also represents a look above and fail as it moved up over the high of the prior three day balance. Due to this odds are increased that there will be rotation to the opposite end of balance which is the 2537.25 and marked off with the lower horizontal line on the chart. The tone will not change unless we see value clearly start to build below this level.

Intraday sellers failed to find acceptance beneath the overnight low, not to mention that they didn’t even make it anywhere near the prior day’s low. If such a rotation as expected in the prior paragraph above was to happen, why didn’t it? The action also created a 45 degree line from the low to prominent TPO POC which indicates that sellers had difficulty getting prices lower. On a very, very short term basis some may be short in the hole.

While all of this was happening, value was overlapping to up and the POC again didn’t move for a 3rd day in a row. Thus traders are committing to prices at these levels and are speaking loudly that they feel prices are fair here. Internals remained more bullish than bearish and there was absolutely no signal from the tick (and the cumulative tick) that any stronger sellers were present at during the entire session.

I truly hope that my comments will help you to see the market more objectively….

Have a great day,
peter