Pundits write how equity valuations are overpriced, how the market has priced in a Clinton victory, and not in position for a Trump victory. On Friday, the FBI announces reopening the case against Clinton and the market flushed. Yesterday,volume was light and the range narrow while I'm assuming Big Money held meetings on what to do next.
Today, with the FOMC meeting underway, Big Money made what i believe, was a coordinated retreat.
Tuesday's Price Action:
- Because of the depth of liquidation, looking back 1 year for market memory
- Following the Friday’s FBI announcement, My opinion is big money had a meeting Monday
- The past 90 days, the NQ and ES built barnacle island structures pursuing All Time High
- Low volume participation at ATH and fundamental over valuations observed at ATH
- Prior to the creation of the barnacle islands was a one year history of sideways trading
- In my opinion, big money deliberately moves to bridge the 1 year HVA and barnacle island
- Price liquidates to defined HVA features drawn days prior
- Strong Buying Tails put in on both ES and NQ
- IMO, this is a contract test
- This would be consistent with the market pricing in Clinton and not Trump
- My targets are now in the LVA following normal tradeable price action.
30 MINUTE PRICE ACTION
MP STRUCTURE ACTION
- 4 distinct distributions
Price Actions
- Key price level tested: ES High Brexit level
- Daily Range 240% average
VOLUME ACTION
- Both at 150% of average
- NQ Volumes started the day with light large lot distribution picking up steam around 1200
- Heavy NQ large lot liquidation until 1515
- Lots of stops had to have been taken out
- Lots of buying power has to have been taken off the table
SUMMARY - In my opinion, price executed a planned retreat, perhaps likely to fill in a low volume area... This should present nominal intraday trading opportunities.
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