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ES #F Demand with large unfilled gap?
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 internal data of the total market. It is updated in real time during the regular trading session of the NY Stock exchange 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”.
In our last assessment we concluded that absorption took place and that the market will move higher. This did happen Yesterday, but the regular trading session started the day with a 15.75-point gap to the upside. The total gain for the day was 19.75-points, meaning the ES advanced only 4-points to the upside during the regular trading session? It is a well-known fact that nearly all gaps get filled in the S&P 500 over time. The price action during regular trading was not totally convincing for any possible substantial advance to come?
Daily Signals May the 18th
The Supply and Demand Reading (1st row) came it at 7.1 with Demand dominating.
Supply and Demand Direction (3nd row) was to the upside (lime up triangle), indicating upwards direction, with substantial strength.
Average Supply and Demand Volatility (4th row) is below 100% and is bullish. The change in average Volatility from the previous day was positive 2 (demand strengthening) as shown on the right of Sup/Dem Dashboard.
We had a buy signal on the signals board (1st row).
Daily Volatility direction (2nd row) was Up (blue up triangle). The change in daily Volatility from the previous day was positive 77 (Demand strengthened) shown on the right of BXB Dashboard.
The NY Stock market traded Higher for the day (blue up triangle in 3rd row).
54% of stocks (4th row) traded above there VWAP (Volume Weighted Average Price) compared to the previous day’s 50%, a positive sign for the markets.
In short Demand dominated which resulted in a 19.25-points up move in total, but only a 4-point gain for the regular session. Price could not penetrate the previous swing high at 2741.25.
We still believe the market will go higher in the following 4 weeks till about middle of June according to our assessment of our proprietary pattern model, but more short term weakness is a possibility, before another substantial move higher. Our targets to the upside are 2741.25, 2756.50, 2789 and 2802.
We are in Selling pressure territory so some more weakness is a possibility.
We took two opportunities during the last trading session on the 26-minute chart below:
Strategy is simple, enter when 2 Dashboards align and exit when two opposite triangles on BXB Dashboard appears, shown with arrows on the chart. We do not take trades when the of Supply and Demand Sentiment tool is at or near extremes (over-bought/sold) in the same direction of the possible trade. The last sub window on the chart shows the Greed / Fear sentiment measurements of Supply and Demand Sentiment tool. Similar to an Oversold / Overbought situation (but without using price related formulas).
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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