Peter’s Premarket Perspective | Wednesday, March 23, 2022

Peter Reznicek

The Market Profile value areas and ShadowTrader Pivots for /ESM22 and /NQM22 Futures are posted free every morning in the ShadowTrader Swing Trader newsletter.

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  Pre market indications
Opening In/Out Balance in balance
Overnight Inventory balanced
Current Price/Overnight Range lower third
Shock and Awe no
Potential for Early Trade no
Short Term Bias primary downtrend broken
  Key Levels for Today
4515.00 RTH High / ONH
4486.00 Top of Single Prints
4467.50 RTH Low
4440.50 VPOC 3.21

Ongoing Narrative / Commentary

We come into this session slightly down on a non true gap lower after five sessions of one time framing on the daily chart.  That is a dynamic to carry forward as it is generally unsustainable for so many sessions.  

Corrective activity has been extremely minimal in this advance and the overnight activity thus far is no exception.  There has simply been no price exploration below any prior day’s low, hence the one time framing on the daily.  

Yesterday’s RTH distribution has a relatively prominent TPO POC which gives us two pieces of valuable M.G.I.   The first is that on any rally today, the market will want to target this level.   The second is that a lot of two sided trade took place yesterday which tells us that buyers may be running out of steam in the short term.   Potential is certainly there for at least a liquidation break that would clear out some of the poorer location longs.  

I am noting that the ONH came right to the RTH High (short by two ticks) and am carrying it forward in my narrative as a further breakout level at some point.  Given the context, I would not attempt that trade today but rather after some balance or correction.

VPOC’s
  • 03.21  4440.50
  • 03.15  4219.50
  • 03.14  4163.50

Scenarios

  • After five sessions of one time framing on the daily, location is poor for new longs that are trading longer than the day timeframe.  Potential is there for a  liquidation break with the big question being  whether or not it will take out the RTH Low or not.  If so, the first VPOC below us (4440.50) would be in play.  
  • Never forget door number three.  While current context is short term overbought, the market doesn’t have to liquidate or do anything.   Correction by time and not price is correction just the same.  
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Peter Reznicek

Peter Reznicek is the founder of ShadowTrader.net and writer of Peter's Premarket Perspective, a morning market profile blog to help people plan their trading day and organize their thoughts before the market opens. He can be reached at asktheshadow@shadowtrader.net.

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