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ES #F Supply late in session
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, the “footprints” of the “Big Boys” or “Smart Money”.
We concluded our previous assessment with “the Supply / Demand reading was still bearish (-1.5) for the day on a net 5.25-point gain. This is an anomaly as indicated by the Unbalanced market warning signal. With the mixed signals our assessment is that the Bulls did not do enough Yesterday to be convinced of any major near term advances, and we still favour the Bears on a balance of probabilities with the above readings and signals” and the market responded Yesterday as expected, moving 26.50-points down Yesterday.
Price closed around the Mean (Regression) with a little Selling pressure developing during Yesterday’s trading session. Supply dominated Yesterday’s last third of the trading session with a nice downward move to close at 2625.75. The current up wave volume (still in progress) is the lowest (4.32m) since December the 4th and should price move down further to complete the upswing, it can still signal No demand. Price did not move far enough to the down side to end the upswing.
The Supply and Demand Reading (1st row) was -1.9 Yesterday which indicates Supply was dominating.
Supply and Demand Direction (3nd row) was to the downside (red down triangle), indicating downwards direction, with substantial strength.
Average Supply and Demand Volatility (4th row) is above 100% and is bearish. The change in average Volatility from the previous day was negative -20 (bearish) as shown on the right of Sup/Dem Dashboard.
We have an alignment signal to the down side on the signals board (1st row).
Daily Volatility direction (2nd row) was Down (maroon down triangle). The change in daily Volatility from the previous day was negative -25 (bearish) shown on the right of BXB Dashboard.
The NY Stock market traded Down for the day (maroon down triangle in 3rd row).
42% of stocks (4th row) traded above there VWAP (Volume Weighted Average Price) compared to the previous day’s 74%, a negative sign for the markets.
In short we saw Supply dominating later in the trading session Yesterday. Price closed around the Mean (Regression) in Selling pressure territory. All signals and readings are bearish. The key for today is to see how much Supply is left and the intensity of the follow through to the down side will be an important factor.
Resistance to the down side are at 2611.25 and 2584.50 with a strong wall between 2559.50 and 2552.00.
We need follow through and to stay in Selling pressure territory for more down side movement to occur. If the market trade down in the short to medium term, the line in the sand for the bulls will be the February 9th low at 2529. A close below this level will Technically damage the bull market.
There were 3 opportunities during the trading session Yesterday on the 26-minute chart below:
Strategy is simple, enter when 2 Dashboards align and exit when two opposite triangles on BXB Dashboard appears. First entry was short (magenta down arrow) with a small profit. The second entry was long (green up arrow). The third-short entry worked well and was a big winner!
The last sub window on the chart shows the Greed / Fear sentiment measurements of Supply and Demand. Similar to an Oversold / Overbought situation (but without using price related formulas). The white lines drawn on the chart is where greed reached a peak and thereafter the market went down for about 29-points.
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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