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Assessments / Blog


2018-04-19
ES #F Sideways action


The daily chart above shows our SUPPLY and DEMAND Dashboard and BXB (Bar by Bar) Signals.

Readings are based on Supply and Demand and Volume obtained from raw internal data of the total market. It is updated in real time during regular trading sessions and does NOT take into account any price indicators or mathematical formulas using price. We do however show the cumulative price change for the trading session and in some instances assess price movement’s relationship to Supply and Demand. It is therefore fair to say that the readings and signals are independent from other popular price indicators and others shown on the chart. The readings are an independent assessment of the one and only measureable fundamental market mover: SUPPLY and DEMAND. It does not matter if price is influenced by a geopolitical event, seasonality, fundamental economic data releases or sentiment driven news, etc. It all reflects in Supply and Demand, leaving “footprints” by the “Big Boys” or “Smart Money”.

 Price stayed in a narrow range Yesterday and ended up trading sideways as we expected. We warned about a possible pullback which did not occur, but ended up trading only 2.75 points higher for the regular trading day. On the intraday chart below the initial downward move (as expected) was short lived and reversed to trade mostly sideways for the regular trading day.

There were no obvious serious signs of weakness Yesterday. The only aspects of concern are still the Divergence to the down side on the Volume Oscillator, and the BXB Board that shows a Balanced market warning and the BXB volatility for the day was down, as well as the Stock market in general.

Dashboard:

The Supply and Demand Reading (1st row) was +3.8 Yesterday which indicates moderate domination by the buyers.

Supply and Demand Direction (3nd row) was to the upside but not strong (blue triangle), indicating no substantial strength to the upside. Ideally we want to see a lime coloured triangle.

Average Supply and Demand Volatility (4th row) is below 100% and bullish. The change in Volatility from the previous day was positive (bullish).

BXB Signals:

On the signals board there is a Balanced market signal. When these signals appear it can lead to a pause or pullback in the market (1st row orange square).

Daily Volatility direction (2nd row) was down (maroon triangle).

The NY Stock market traded down for the day (red triangle in 3rd row).

36% of stocks (4th row) traded above there VWAP (Volume Weighted Average Price) compared to the previous day’s 55%.

In short we did not see strong demand Yesterday and price only went up 2.75 points. The volume was again low for the day. If a pullback does not occur, some more sideways price action may appear in today’s trading session. We will be careful to take any long positions today, due to the warning signals and weaker daily readings on the BXB Board.

Intraday

There was only one good opportunity during the trading session Yesterday on the 26-minute chart below:

Marked with arrows on chart. Strategy is simple, enter when 2 Dashboards align and exit when two opposite triangles on BXB Dashboard appears. Green arrows drawn on chart show entries and red arrows show exits. Alignment for a buy entry means 1st row lime, 2nd row blue or positive, 3rd row lime triangle up, 4th row lime volatility reading on the Sup / Dem Board. On the BXB Board we must see 3 up triangles (or at least two triangles, the 2nd and 3rd rows pointing up) for an entry. If we see 2 down triangles on the BXB after we entered, we exit the trade.

RISK DISCLOSURE:

The information delivered here is for educational purposes only and is not intended to be a recommendation to purchase or sell any of the stocks, futures or other securities referenced. All references are for illustrative purposes only and are not considered endorsed or recommended for purchase or sale by MC Trading.

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