Peter’s Premarket Perspective | Tuesday, May 31, 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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Click HERE for a market profile key that will help you interpret the chart above.

  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 /ES trendline break / short term trend change
  Key Levels for Today
4202.50 ONH
4107.50 Top of Single Prints
4079.50 RTH Low
4062.00 VPOC 05.26

Ongoing Narrative / Commentary

On most three day weekends futures trade a shortened RTH session that ends at 1pm ET.  This weekend was no different as you can see from the small distribution in the market profile pic above.  We ignore these sessions and consider them a part of the overnight activity.  I’m also not calling spike rules on Friday’s late day advance as it started in M period rather than N.  Those of you using study in TOS that automatically calculates the pivot levels and places them on the chart should note that your levels will be incorrect today because the software is taking the shortened session into account and counts it as a regular day. 

We now have  four VPOC’s stacked below us from recent trade.  That may (or may not) be unsustainable.  Carry it forward in your narrative and look for some of these areas to get tested (read: targets!) on any weakness over the next few sessions.

Today is an important day to not get overly caught up in what you think should happen.  The markets are obviously overbought in the short term.  But are you going to try and force a short today or will you attempt a short only when you have signals and context lining up that support that argument?

I’ll leave you with an hourly of the /ES showing where the uptrend line is coming in.   It would make sense that we would at least see prices come into this area in today’s session.  But markets don’t need to make sense in order to accomplish their objective.

Will sellers take it at least to here?
VPOC’s
  • 04.21  4390.00
  • 05.06  4121.00
  • 05.26  4062.00
  • 05.25  3948.00
  • 05.24  3885.50
  • 05.20  3830.50

Scenarios

  • Potential is there for some weakness today given how far we’ve come in a very straight line and the VPOC’s stacking up below us.  Context is king.  Let the setup come to you rather than forcing it because you think something HAS to happen.  A weak market will more than likely either have no opening drive higher or one that will be retraced back to open quickly.  
  • Finding acceptance and holding it in the upper part of Friday’s VA would be a bullish sign.  Any lack of testing the signposts noted above should be construed as bullish.   Remember to think in terms of what should happen and then let price action either confirm or deny it.
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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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