Thursday, November 17, 2016

Approaching Thin Air


SUMMARY
- Price is grinding higher and entering "thin air" altitudes, where price action has historically slowed down




MP ACTION - ES
ES PRICE ON THE NORTH SIDE OF POC 34 (THIN AIR REGION)
Price action slowing approaching ATH



  • Price matched recent globex (-2) high
  • Three consecutive trending days






MP ACTION - NQ


NQ PRICE ON THE NORTH SIDE OF THE BARNACLE ISLAND POC
PRICE APPROACHING THIN AIR TERRITORY

PRICE APPROACHING ELECTION NIGHT HIGHS



VOLUME ACTION
    • EOD VOLUME DROPPING TO PRE-ELECTION LEVELS
    • NOT SEEING AN ATTACK ON ATH WITH INCREASING EOD VOLUME








VOLUME/PRICE ACTION - 1 DAY VIEW
  • WHAT WOULD’VE BEEN A GOOD OBV DAY ENDED WEIRD ON THE ES
  • EOD SELLOFF IN ES BROUGHT PRICE OBV TO ALMOST NET ZERO
  • HOW DID PRICE NOT DROP?
  • WATCH FOR ES PRICE TO COLLAPSE IN THIS THIN AIR REGION?



VOLUME/PRICE ACTION - 90 DAY VIEW

  • UPTURN AFTER THE ELECTION OF OBV READING
  • ES OBV STILL NEGATIVE AS PRICE HEADS INTO THIN AIR TERRITORY (HEDGES)
  • NQ OBV NEAR NEUTRAL HEADING INTO THIN AIR TERRITORY


RULING REASONS
- The EOD selloff in the ES is curious - Will these high's hold?
- Price action is slowing down as the ES approaches all time highs with trading volume declining to pre election levels.
- The NQ appears to be happy filling in support inside of low volume areas
- Great swing trading behavior
- 3 days into trend (watch for trend to continue and Step 2/3/4 action