Wednesday Prep
Value shifted lower yesterday after a volatile morning session around unsubstantiated rumours of tapering in the ECB's bond buying program. We saw responsive buying off yesterday's 2135.75-37.25 range support zone, though this may be a temporary bounce until the market can regain the 2152.50 level.
Overnight the range is currently 2141.00-47.25, within the lower half of yesterday's range.
My zones for today:
Tuesday Prep
A very balanced session yesterday with low volume and news flow giving few decent opportunities. The market traded around the composite high volume node at 2152.50, which is a useful short term pivot also marking yesterday's overnight low.
The 4hr chart with custom profiles below shows the key areas of intermediate support and resistance.
Overnight so far the range is 2153.00-59.75, holding above the CHVN at 2152.50 which is neutral/bullish. Zones of interest for me today are below. 2159 and 2166 are two CLVNs I would expect response from sellers, and a squeeze if holding above 2166 to press for the 2172.75 swing high/CHVN and beyond. Acceptance back below 2152.50 puts likelihood of rotation lower to repair yesterday's poor low and potentially test the larger time frame support areas below.
Friday Prep
Yesterday opened within the upper distribution of the prior day and moved above the prior RTH high by 2 ticks with divergence in the order flow before rejecting the breakout and reversing. The aggressive move lower was driven primarily by a major sell-off in Deutsche Bank shares and the associated news, though the market managed to form a lower distribution and POC/VPOC within the prior day's range. The distributions are split with single prints between 2154.00-55.25.
Overnight took out the low from yesterday, after the European open, and has climbed steadily since. The range is currently 2135.75-2149.50.
Overnight support zones at 2142.75-44.25 and 2135.75-37.25.
Key support at 2131.25-32.75 - holding below here could put the market into longer time frame long liquidation mode.
Initial resistance at 2151.50-23.75 - if overnight rally sees a rejection of this zone after the open, it puts increased likelihood of yesterday's and the overnight low being taken out. Expecting strong correlation with Deutsche Bank shares throughout the session in absence of other market moving information.
Today's Zones:
Thursday Prep
Yesterday opened and failed to take out the overnight high, leaving a poor high early on. Back inside the prior range saw prices slip back to around the prior mid, value area low and composite low volume area before selling dried up. A break above the lunchtime balance area squeezed shorts and the OPEC news on production cuts led to an oil driven rally back into last friday's range.
The short term bullish move is heading back up towards the all time highs, though there are a few areas of longer term resistance ahead within the larger balance area currently in.
2157-59 area is the first area of key support for longs to hold. Acceptance below there could see some long liquidation and rotation lower to the 2152.50 chvn and current week's vpoc.
Breaking and holding above the 2166-67 resistance would continue to pressure shorts. The 2166 clvn may become support on a pullback from a break.
Zones for today:
Wednesday Prep
Review
Very balanced profile on fairly light volume (1.38m) with negative trending cumulative delta (-52k at RTH close), inside prior day's range.
RTH 1 min below with yesterday's zones:
The BoJ announcement overnight saw an initial break lower, which was short lived, and a rally to re-test yesterday's high at the initial resistance zone.
I'm keeping the zones as they are for today ahead of the FOMC announcement - depending on what is said, there remains a large open range gap above from 2158.00-69.25. If we see a sell-off down to the 2115.75-17.25 zone and it fails to hold then we could see sellers target a move lower to the 2080 area.
Today's Zones:
Tuesday Prep
The early move above last Thursday's poor high failed to bring in sustained buying and once the market accepted back inside the 2144.25 overnight high we saw long liquidation and strong selling to close the lower range gap from Friday and push through the 2129 naked vpoc. The near 30k drop in cumulative delta and extreme TICK readings saw late sellers trapped and an aggressive short covering rally left a decent buying tail on the day.
The overnight range so far is 2130.75-42.00 and the zones for today are little changed.
Monday Prep
240 min with custom volume profiles
The break lower this month has formed a consolidating triangle pattern which the market is attempting to break out of overnight and faces resistance at the composite low volume area shown above.
The week has opened above last week's value area and is currently testing my initial resistance zone at 2143.50-45.00. If we see responsive selling there, overnight support is at 2138.00-39.50 followed by the 2131.00-34.25 zone, which could still see buyers take control.
Acceptance below 2131.00 would signal short term failure by longs and would expect shorts to target the zones below.
Acceptance above the initial resistance zone would signal a short covering rally and attempt to take out the 2156 swing high from last week. The RTH range gap from 8-9th Sept remains open between 2158.00-2169.25.
Overnight & RTH Profiles
Review - Tuesday
Yesterday opened at the overnight VPOC and quickly pushed higher to the current range upper distribution and nVPOC from 7/22. Failure to hold this ground saw a break below the range LVN and a cascade of trapped longs sell stops helped drive quickly to the VAL of the RTH range before a sharp reversal back up to the breakdown point.
Yesterday's RTH session below next to combined profiles of the current range since 7/14:
1 min RTH chart with vwap, market internals,cumulative delta and zones
Buyers had a strong response at the first support zone, in line with the longer time frame bullish context.
Review - Monday
Yesterday opened and tested higher to the current range upper distribution HVN at 2167. The move lower stopped a tick below yesterday's globex low before reversing.
Volume was fairly low at 1.2m, though liquidity remains thick in the order book with declining volatility.
Settlement was at 2162.25
The combined day session profiles of the current balance area show the double distribution. Yesterday rejected the upper distribution HVN but managed to close above the volume and time POC at 59.25. We didn't see a test of the value area low of this range yesterday, so I would look for that as a possible destination followed by the 51.25 LVN below if the market holds below 59.25.
I'm looking for potential resistance above at the 64.25 LVN, and if that fails a move to the 67 HVN and resistance or break higher to at least test the globex all time high in the day session.
The current range and it's value area below on the 120 min Globex chart below, with value between 53.50-62.25.
The next HVN below current range is at 46, the prior range VPOC.
We are in a neutral phase until buyers can either hold above the 67 HVN or sellers can press below the 51.25 LVN and 49 swing low.