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2018-06-23
ES #F Demand, weak close


The 3-day and daily charts above show our SUPPLY and DEMAND Dashboard and BXB (Bar by Bar) Signals using data from the NYSE.

We are still trading in the potential re-accumulation zone (between 2785.25 and 2747.00, see description below). The 3-day chart still shows Supply is dominating, whilst we have all bullish signals on the daily chart, except for the Simplified Volume Oscillator which is still in Selling pressure territory. There is thus no alignment of the immediate and longer terms at the moment.

RE-ACCUMULATION

Once an instrument (future, stock, forex, commodity etc.) has gone through accumulation and experiences successful ending action, it begins its uptrend. It is not uncommon for an instrument to pause during this rally and, once again, begin moving sideways. If, after this sideways trading range, the up trend continues, this trading range would be a period of re-accumulation.

Re-accumulation can begin in one of several ways:

_ An instrument can have a major Sign of Strength (Jump the Creek). Then, instead of reacting and putting in a Last Point of Support, it moves sideways in a new trading range.

_ The instrument can experience a normal corrective reaction, go through a period of re-accumulation, experience successful ending action and resume its uptrend.

_ The instrument can simply roll over and begin moving sideways. This is usually due to a withdrawal of demand. If, at the end of the sideways move, the instrument experiences successful ending action, it would resume its upward trend.

_ The instrument could go through a minor Climax and establish a more traditional trading range. Once again, successful ending action would result in a resumption of the upward trend.

NYSE Daily Signals June the 22nd   

Dashboard:

The Supply and Demand Reading (1st row) came in at 4.9 with Demand dominating the trading session.

Supply and Demand Direction (3nd row) was to the downside (lime up triangle), indicating upwards direction, with substantial strength.

Average Supply and Demand Volatility (4th row) was below 100% which is a bullish sign. The change in average Volatility from the previous day was positive 34% (Up) as shown on the right of Sup/Dem Dashboard.

BXB Signals:

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 177% (Up) shown on the right of BXB Dashboard.

The overall NY Stock market traded Lower 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’s3 9%, a positive sign for the markets.

Mixed signals between immediate term and longer term, and still in Selling pressure territory on the daily chart and a poor close on relative strong Demand, makes us believe we will have another down day on Monday. Price can move sideways until we have Supply weakening on the 3-day chart.

Caution:

The trading range between 2785.25 and 2747.00 is an important area and price can be caught in this range for several days. A bar close outside of this area will probably lead to a substantial move. A close above 2796 in our view, is needed to get the Bullish momentum on track again. A close below 2735.75 will spark more selling.

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Click here for example of reversal trade taken in Feeder Cattle that can be found on this page.

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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