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ES #F Demand again?
The 3-day and daily charts above show our SUPPLY and DEMAND Dashboard and BXB (Bar by Bar) Signals.
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”.
This week we had the Trump-Jong Un summit, the Fed's interest rate hike, and the news that the ECB will leave Europe's rate unchanged. Nothing shook the market from its complacency and it seems the markets are subdued. Today’s action may give more directional clarity?
Yesterday the ES gained 9.25-points to close at 2788.25 after an initial drop to a low of 2772.25. At the time of this writing the ES is trading at 2787.50. The gain Yesterday came on a very low demand reading of 0.2, whilst average Volatility increased to the bearish territory. This is mixed signals. Given the fact that we still have Supply dominating on a 3-day basis, we will be very cautious to take on long positions at the moment.
Support to the down side will come in at 2772.25 and 2756.00 if weakness for the near term continues. Resistance to the upside is at 2796.00 and 2807.25.
Daily Signals June the 14th
The Supply and Demand Reading (1st row) came it at 0.2 with Demand dominating the trading session, by a whisker.
Supply and Demand Direction (3nd row) was to the upside (blue up triangle), indicating upwards direction, with No substantial strength.
Average Supply and Demand Volatility (4th row) went above 100% which is a bearish sign. The change in average Volatility from the previous day was negative 19 (Supply) 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 108 (Demand stepped in) shown on the right of BXB Dashboard.
The overall NY Stock market traded Higher for the day (blue up triangle in 3rd row).
51% of stocks (4th row) traded above there VWAP (Volume Weighted Average Price) compared to the previous day’s 36%, a positive sign for the markets.
We are neutral to bearish as to the near-term direction, but bullish on the longer term. Although we had a buy signal on the daily chart, average Volatility is bearish and thus in our view mixed signals with no clear directional clue. We need to break the 2796.00 level to establish a solid bullish foundation again for the near term.
The 3-Day and Weekly charts still show Supply dominating at the time of this writing. If we have an up day today the near term picture can turn bullish again.
We took two opportunities during the last trading session on the 26-minute chart below. Entries and exits are shown with arrows:
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 below shows the Greed / Fear sentiment measurements of Supply and Demand Sentiment tool. Similar to an Oversold / Overbought situation (but without using price related formulas).
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