Tuesday, October 25, 2016

Early voting week.....

YESTERDAY'S Price Action:
  • NQ has put in a 2-day round top and eded the day sitting on a gauntlet of support
  • ES continues to fill in the noted Low Volume Area.
  • The daily range of both are between 15-25% below average (narrow trading day)

MP Action

  • Consistent with what we’ve been calling for over the past few days
  • ES is filling in LVA
  • NQ is creating a barnacle island

  • Also, the NQ gauntlet described prior appears to be holding as support in the NQ.
  • Also, remember the anomaly loaded MP structure back on 10/11 (clue - if we break convincingly into the gauntlet, run for the other side as only Large Lot Traders are likely to be able to march through this, If we break into this gauntlet and sit, it will likely be a short timeframe trader.

  • Light volume today
  • Last three days have been subaverage volume
  • Daily range below standard (makes sense as we are 1) in white space on NQ, 2) filling LVAs on ES, and 3) Two weeks before an election.

  • NQ OBV shows ~5k contracts liquidated (makes sense as we discussed the need for the accumulator of the prior few week’s need to mark up distribute, and that we are near the top)
  • ES OBV shows approximately a net no-change (makes sense as we are simply filling in an LVA)

  • Last weeks round bottom indeed broke out long, and right into defined resistance.
  • Judging from the aftermarket, we will be going short for tomorrow.

Price action is showing me that NQ appears to be rejecting higher prices near contract high while the ES is rejecting higher HVA -  I will be looking for profit taking selling tomorrow and back into value.