How do we understand that smart money is getting out of their shorts? and how the dumb crowd get trapped into it? Here is the high probable trade setup using market profile which explains the context of inventory getting short to too short and the potential risk in holding trade in line with the emotional players.
✔ Build high-probability trade setups
✔ Understand institutional price behavior
✔ Trade Nifty, Bank Nifty & Stocks with structure
✔ Improve entries, exits & risk management
✔ Develop disciplined trading psychology
✔ 85+ Hours of Live Interactive Learning
Nasdaq Futures breached the psychological reference 7000 levels on wednesdays trading session with a continuous slow and steady slide. However the profile structure says a different story. Notice the profile structure which had made almost 4 consecutive lower highs(numbered in the pics). Smart money always love to do a stealth liquidation of shorts and one of the zone where emotional short sellers pile up.
The longs that hadn’t liquidated felt their apprehension growing, and as the market was nearing the last half hour of the day,
was the anxiety was too much and the laggard longs threw in the towel.
Nasdaq Futures – Inventory getting short to too short
As the emotional sellers pile at poor prices inventory goes short to too short. Which indicates a potential risk in holding longs inline with emotional traders. The end result could be a high probability short covering and testing prev day high in a very shorter term.
Nasdaq Futures Updated (T+3 Day)
Nasdaq Futures updated as on 6th July 2018
