Jump to content

Welcome to the new Traders Laboratory! Please bear with us as we finish the migration over the next few days. If you find any issues, want to leave feedback, get in touch with us, or offer suggestions please post to the Support forum here.

  • Welcome Guests

    Welcome. You are currently viewing the forum as a guest which does not give you access to all the great features at Traders Laboratory such as interacting with members, access to all forums, downloading attachments, and eligibility to win free giveaways. Registration is fast, simple and absolutely free. Create a FREE Traders Laboratory account here.

ant

ES Analysis for 8/30 (in hindsight)

Recommended Posts

In this post http://www.traderslaboratory.com/forums/6/interesting-initial-balance-statistic-978-4.html#post18089, Dogpile asked:

 

curious what your 'post-mortem' on 8/30 is ant? how do you think about the structure for that day in context with previous action?

 

So here is my analysis. My analysis on the ES for the trading session of 8/30 is as follows. First, I look at the daily chart and identify high/low volume areas, balance areas, and other key reference levels. So for 8/30, I keyed on the high volume area around 1464.75-1468.75, the balance area between 1484-1434.50, and the swing high at 1510.50 as a potential trade destination. I also noticed that there an internal trend within the balance area, auctioning for the lower balance area extreme to the upper. See the chart below.

 

ES1.thumb.GIF.648d992b7be33fd611f6aef11a44e402.GIF

 

Next, I focus on the daily Market Profile graphics. From the daily chart, I identified that the short-term market condition is balance (trading range) since we have a balance area from 1484 to 1434.50. The buying tail from 8/28 drew my attention because usually a "Tail" ends one auction and starts a counter-auction. That is, the buying tail of 8/28 indicated the end of the down auction that started on 8/27, now I was expecting an up auction on 8/29. I'll skip some of the details with the spike on 8/28 since it isn't that pertinent for trading on 8/30. Lastly, I keep in the back of my mind that the spike on 8/29 basically closed the gap formed during the 8/28 opening and also closed within the high volume area highlighted in the daily chart. The volume during the spike wasn't that impressive either. After a spike, the question becomes will value follow price or will price revert to the mean (POC)? 8/29 left a bunch of single prints from the range extension. See the chart below.

 

ES2.thumb.GIF.b716923e0a48996b7b5c2ffc121e7c56.GIF

 

Prior to the regualr trading session of 8/30, I take a look at the overnight session to see what happened and where the market may open. Nothing to note from the overnight session at this point.

 

Now, the trading day starts on 8/30. Here is what I was paying attention to... The previous day's high and the high volume area. If we can cleanly take out those levels, I would look to get long. But the market gapped down and opened at the VAH of 8/29. At this point, I am looking for a volume or momentum divergence to get long. See chart below.

 

ES3.thumb.GIF.c4af631c9a5981e4a46871ac043049cd.GIF

 

I use the 400 and 1600 tick charts and the 5 and 15 min charts for entry. On the 1600 tick chart, I identify a momentum divergence (using the 3/10 oscillator) at the previous day's VAH. See the chart below. I put this together with the fact that we started an up auction within the balance and immediately think to get long with a target of the previous day's high or high volume area as seen on the daily chart. Note that on 8/30 the ES is "one timeframing" from 9:30 to 11:30am EST so I don't even consider fading at this time. "One timeframing" is when each bar fails to take out the previous bar's low and often puts in a higher high (I look at the 30 min chart here). This indicates high confidence amongst the buyers. I will only consider fading once the auction ends as signaled by a tail or the previous bar low being taken out, like what we saw after 11:30.

 

ES4.thumb.GIF.987058117a41efc43a27e0f17d9a5cf0.GIF

 

As the ES moves above the previous day's high and high volume area, the move does not appear to convincing to me because of volume. See chart below. You can also see a momentum divergence in the chart above. If we re-enter the previous day's range, then this is telling me that buyers may be losing confidence and I would start thinking about getting short. I would use the previous day's POC and/or the start of the spike of 8/29 as a potential target, which serves as support. I won't go much further then this, but the market started to balance for the rest of the day providing fsome fading opportunities. Keep in mind that this all may seem complicated, but it really isn't because I have a trade plan and use a systematic approach. I do this everday during my trade preparation. I'm just trying to be thorough in my response, which requires a lengthy post. I also have all of my charts viewable on one screen so I am able to pick out these developments.

 

ES5.GIF.141c6e3920ea9634f8b14ab93eb063b1.GIF

 

By the way, trading on 8/30 resulted in a symmetric Market Profile graphic and established higher value. This is positive for the bulls. Pay attention to value and not price. On 8/31, the ES was balanced again and put in higher value. Although it stopped at the upper extreme of the balance area at 1484.75, we could see a break out of that balance area and a play for 1510.50. I haven't done my analysis for 9/4, but this is probably what I would be looking for. With a symmetric, balanced day like 8/31, one should trade with the directional move away from balance (up or down).

Share this post


Link to post
Share on other sites

I agree with your thinking here. very bullish pattern (ABC down with a buy div after a strong afternoon trend up = 'power buy') -- the tricky part of 8/30 was that it bottomed almost exactly on the open... trading at this time can be a humbling experience as many days will just chew you up trying to enter a position around there -- whether in a support zone or not..

 

very nice analysis.

Share this post


Link to post
Share on other sites

August 30th is a really interesting day to study closely...

 

Here is some of my insight:

 

a few factors to think about, IMO -- best shown in context of what are 'higher conviction days' (8/28 and 8/29).... see attachment for visual aid.

 

8/28 showed very strong conviction to downside as measured by the down-up volume ratio at the top of the attached chart. moreover, all volume was occuring below the previous days closing VWAP. here you have a very bearish combination of high down volume/low up volume all occuring at lower prices (vs previous day closing VWAP).

 

8/29 morning session showed very little down-volume (consistent with the gap up) -- but the volume was occuring below the previous days VWAP -- this can be considered a mixed situation with not much selling going on but you could still consider it a bearish consolidation due to where it was occuring -- it has trapped bears below vs previous day close -- this is bullish.. . but in general, trading that occurs below previous days closing vwap should be considered a negative factor among the positive factors that are emerging. thus we have a mixed reading at first glance.

 

price attempts to push below VWAP but peters-out early in the 8/29 day -- another sign that sellers aren't showing conviction. pattern-wise, you have a higher low and a 'bear trap' that has formed off the 8/28 closing 'excess low'...

 

I have added ants 5-min volume indicator at the bottom as well. here you can see how price pushes up on good vulme and then the volume on the mid-day pullback occured on low volume and that price found support at VWAP... effectively, you have a triangle here -- and price eventually auctions up hard out of this mid-day 'balance'... up volume is strong and vast majority of trading has occured above current-day VWAP and all trading above previous day low. moreover, I posted one of my favorite 'oscillator patterns' here:

 

http://www.traderslaboratory.com/forums/attachments/6/2587d1188439940-potential-afternoon-es-action-8-29-15-min-first-cross-buy.png

 

thus, you have very strong afternoon trend up and a key rejection of the previous days closing price -- IBD calls this day a 'follow-through day' and the kind of day that often ends major corrections (to be determined though).

 

on to the day for comparison...

 

8/30: very interesting day to study. price gaps down but stays above previous days closing vwap. any big gap will skew the upside/downside volume indicator so you have to monitor action and not rely too much on this indicator. ant analyzes this day very well. you can see how price moves up immediately off the open (after the globex 'abc down'/1600t buy divergence). price holding above previous day VWAP is a clue of 'positive consolidation' going on... Responsive buyers come in and push price up above VWAP where it continues up. as price extends above previous day high, can see the up/down volume ratio trending in the right direction but is not in 'high conviction' mode --- where the ratio would certainly be well above 2.0.... Again, a triangle forms mid-day and price breaks below VWAP for an attempt down. volume never really picks up though and the sellers exhaust themselves after a decent move down. net net, the day ended down on a close to close basis but built higher value and the attempt down that peters out is a positive sign that there just aren't many sellers around -- that was a good chance to break lower --- and it ran out of gas --- closing essentially right on the VWAP level.

5aa70df9d9aa1_ES8-30VolumeAnalysis.thumb.png.19e7f068b87151279a11f39c6be10800.png

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.


  • Topics

  • Posts

    • AMZN Amazon stock, nice buying at the 187.26 triple+ support area at https://stockconsultant.com/?AMZN
    • DELL Dell Technologies stock, good day moving higher off the 90.99 double support area, from Stocks to Watch at https://stockconsultant.com/?DELL
    • MCK Mckesson stock, nice trend and continuation breakout at https://stockconsultant.com/?MCK
    • lmfx just officially launched their own LMGX token, Im planning to grab a couple of hundred and maybe have the option to stake them. 
    • Date: 2nd April 2025.   Market on Edge: Tariff Announcement and Volatility Ahead!   The US economic and employment data continues to deteriorate with the job vacancies figures dropping to a 5-month low. In addition to this, the IMS Manufacturing PMI also fell below expectations. However, both the US Dollar and Gold declined simultaneously following the release of the two figures, an uncommon occurrence in the market. Traders expect a key factor to be today’s ‘liberation day’ where the US will impose tariffs on imports. USDJPY - Traders Await Tariff Confirmation! Traders looking to determine how the USDJPY will look today will find it difficult to determine until the US confirms its tariff plan. Today is the day when Trump previously stated he would finalize and announce his tariff plan. The administration has not yet released the policy, but investors expect it to be the most expansionary in a century. President Trump is due to speak at 20:00 GMT. On HFM's Calendar the speech is stated as "US Liberation Day Tariff Announcement". Currently, analysts are expecting Trump’s Tariff Plan to impose tariffs on the EU, chips and pharmaceuticals later today as well as reciprocal tariffs. Economists have a good idea of how these tariffs may take effect, but reciprocal tariffs are still unspecified. In addition to this, 25% tariffs on the car industry will start tomorrow. The tariffs on the foreign cars industry are a factor which will particularly impact Japan. Although, traders should note that this is what is expected and is not yet finalised. Last week, President Trump stated that he would implement retaliatory tariffs but allow exemptions for certain US trade partners. Treasury Secretary Mr Bessent and National Economic Council Director Mr Hassett suggested that the restrictions would primarily target 15 countries responsible for the bulk of the US trade deficit. However, yesterday, Trump contradicted these statements, asserting that additional duties would be imposed on any country that has implemented similar measures against US products. The day’s volatility will depend on which route the US administration takes. The harshness of the policy will influence both the Japanese Yen as well as the US Dollar.   USDJPY 5-Minute Chart   US Economic and Employment Data The JOLT Job Vacancies figure fell below expectations and is lower than the previous month’s figure. The JOLT Job Vacancies read 7.57 million whereas the average of the past 6 months is 7.78 million. The ISM Manufacturing Index also fell below the key level of 50.00 and was 5 points lower than what analysts were expecting. The data is negative for the US Dollar, particularly as the latest release applies more pressure on the Federal Reserve to cut interest rates. However, this is unlikely to happen if the trade policy ignites higher and stickier inflation. In the Bank of Japan’s Governor's latest speech, Mr Ueda said that the tariffs are likely to trigger higher inflation. USDJPY Technical Analysis Currently, the Japanese Yen Index is the worst performing of the day while the US Dollar Index is more or less unchanged. However, this is something traders will continue to monitor as the EU session starts. In the 2-hour timeframe, the USDJPY is trading at the neutral level below the 75-bar EMA and 100-bar SMA. The RSI and MACD is also at the neutral level meaning traders should be open to price movements in either direction. On the smaller timeframes, such as the 5-minute timeframe, there is a slight bias towards a bullish outcome. However, this is only likely if the latest bearish swing does not drop below the 200-Bar SMA.     The key resistant level can be seen at 150.262 and the support level at 149.115. Breakout levels are at 149.988 and 149.674. Key Takeaway Points: Job vacancies hit a five-month low, and the ISM Manufacturing PMI missed expectations, adding pressure on the Federal Reserve regarding interest rate decisions. Traders await confirmation on Trump’s tariff policy, which is expected to impact the EU, chips, pharmaceuticals, and foreign car industries. The severity of the tariffs will influence both the JPY and the USD, with traders waiting for final policy details. The Japanese Yen Index is the worst index of the day while the US Dollar Index is unchanged. Always trade with strict risk management. Your capital is the single most important aspect of your trading business.   Please note that times displayed based on local time zone and are from time of writing this report.   Click HERE to access the full HFM Economic calendar.   Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click HERE to register for FREE!   Click HERE to READ more Market news.   Michalis Efthymiou HFMarkets   Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.