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Market Profile Analysis of S&P Futures 05.14.19

By May 17, 2019March 2nd, 2021No Comments

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Continued carry forward lower with value clean to the downside on yesterday’s market profile distribution. Today we are gapping in the other direction, so let’s assess that and it’s context.

  Key Levels for Today
2831.50ONH – lower than yesterday’s high
2837.75RTH high – where opening short covering failed
2799.75ONL and psychological round number (2800)


Currently a 16 handle gap higher. Not a true gap, gap rules are not in play. As of now we are opening in balance and overnight inventory is net long but not 100% so. For what it’s worth if you can start your day by identifying just those four things and nothing else, you will be miles ahead of the competition. I start every single day answering these questions: Do we have a gap and how much, are gap rules in play, are we opening within or out of balance, what is overnight inventory situation?

The late day rally and subsequent gap up are due to two factors in my opinion. The poor low that formed in the RTH session and the proximity to the psychological 2800 level. Overnight trade went just a tad lower but found no new sellers who were willing to commit below that round number. My initial thought on this is that the low is not only weak but poor since it seems driven by a psychological pivot that really has no import. The fact that the low was poor is definitely a carry forward as it stands to be repaired at some point. Beyond that, remember that the push away from poor lows or highs is always a dynamic due to shorter term (weak hands) players. Thus those moves are often retraced.

Yesterday attempted twice to get into the range of 5/10 and failed both times. Currently we are trading about 3 points below that low after marking an ONH that was inside of that range but not as high as yesterday’s RTH high. All of this is noteworthy and will factor into how I look at any rally this morning. It will have to be looked at in that context. A move above the ONH and yesterday’s RTH high on good momentum/tempo/internals may signal stronger short covering to come. A failure to get near either of those levels keeps things status quo and will embolden sellers.


  • If the bias is up then a stronger move may develop once the ONH and RTH high are taken. If so, there could be further retracement into the range of 5/10 whose structure was poor. To where, I really don’t know. There are no obvious nuances like single prints that we could target. A really strong spate of buying would target the POC at 2865.00 which is untested as of now.
  • The market has trended lower for some time now. While there could easily be another trending day lower today, the odds don’t favor it. If it was to happen, we would have to travel a good clip back down through yesterday’s VA and breach the key 2800 level. I think downside may be limited due to push-pull of shorts covering to due to poor location (poor low shows that) against new money sellers that see the gap as a gift. Anything can happen but my personal play is to fade some stocks that I typically daytrade but be looking for smaller moves lower.


Have an excellent day,