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2017-09-15
ES #F Absorption or Distribution?


Another narrow range Smart money up bar at the top (distribution?) and no bar close above 2495.50 or below 2485. The market is winding up for a substantial move up or down. The narrow trading ranges the past 2 sessions are like a spring winding up waiting to be released with force for a bigger move. Is selling absorbed by the Smart money in anticipation for the next move up, or is Smart money selling (distributing) big into all the buying? A bar close above or below the levels mentioned should give more certainty. We had a correction warning (White dot on chart) on the weekly ES chart 5 weeks ago. Corrections can happen on average as many as 5 even up to 8 weeks after this warning signal. See weekly chart with COT indicators attached. Seasonality is down (through the zero line) and the Hedging indicator is up through the 50 percent, making the odds for the Distribution argument better in our view. This is long term signals and it is not impossible that a run to another new high will happen first.

See results of our Strategy on the MTF Tool trading the EURO

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