Wednesday’s profile structure is interesting as it turns out to be a classical trend day. On a Down Trend day market one timeframe lower without breaking the previous bar high. i.e making lower high on a 30min charts. Once the one timeframing broke on Wednesday trading in Nifty Futures.
Nifty Futures lost 5.4% for this month. Interestingly so far it is outperforming Bank Nifty Futures which lost 10% for Sep 2018 alone. Expiry is very near and current Nifty Futures rollover is at 23.73%. Nifty Futures premium is still at 30 points. Daily sentiment remains negative for the 5th day despite having a 100 pointer day in Nifty Futures. On the daily timeframe, Nifty Futures is still making lower lows for the third consecutive day. Momentum buyers controlled the day. Short term support comes around today’s spike base 11060. Volatility is at the extreme though India VIX down 4.27%
E-mini S&P 500 future derivative contract is based on the underlying S&P 500 stock index(US Market). ES-Mini is showing an interesting structural pattern when comes to market profile with trend reversal odds. The structural pattern also reveals the significant risk in holding to the longs as the short term inventory goes long to too long.
Everyone likes to catch trend earlier. How to recognize and monitor the changing trend much ahead of your competition? When the price is testing a psychological reference most of the traders are in active mode. This tutorial explores how one can access the odds using the market profile with a greater conviction where short-term trend reversal happens close to the psychological reference.
Nifty Futures end on Friday with a strong bullish note. Profile Sentiment turned positive however indicator sentiment maintaining negative which brings the odds of sideways to downward markets. Call writers are still active at 11400 and 11500 strike price which puts an immediate EOD resistance at 11400 in Nifty Spot.
Here are two interesting and similar trading setups which help positional traders in spotting very high probability and very high risk-reward ratio using market profile. this tutorial explains how to understand the context of High probability trend exhaustion using short-term inventory conditions and the exponential trading odds with lower risk trade setups
Nifty Futures inventory went long to too long on last Friday. At the Monday open, trading confidence is initially low. Trading confidence is low even after the initial – 2 day breakout with a partial gap fill. However during mid of the day,, one timeframing against the Initial Balance direction is where exactly high confidence sellers started taking control and pressed the price towards the Prominent POC of control 10940 levels.
I guess Nifty is in a make or break zone as the higher timeframe range is getting tighter & tigher. The United States and China slapped tit-for-tat duties on $34 billion worth of each other’s imports on Friday, with Beijing accusing Washington of triggering the “largest-scale trade war”. Despite the negative news factor, Asian markets (China, Hang Seng) recovered the early losses and closed positive.
Nifty Futures trading in 10600 – 10900 range and this range is getting even tighter possibly 10700 – 10900 in the near term as the call/put writers are writing at tightly packed zones. When Comes to Nifty Futures Index short stops are hunted in a phase manner. And more short term stop clusters are in the zone from 10790 – 10850 levels. Short term sentiment maintains positive for last 5 trading sessions.
Here is one of my Signature trades using market profile and how one can look through the trade setup for a potential short covering rally especially when we are dealing with negative global emotions . On Wednesdays trading most of the Asian Markets are down due to the trade war tensions and the previous day US Markets slides to negative. The most interesting part was 4th July US markets are closed for Independence day.
High Volatile Choppiness is the name of the game being played in Nifty. Since 25th of May lack of serious buying and lack of serious selling is witnessed which is keeping the market in a range despite Chinese market crashing and emerging market currency crisis. Local currency USDINR too touched all time high and currently around 68.74
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.