May 312012
 

The Value Area Report is a daily trading plan based on Auction Market Theory, Market and Volume Profiling techniques for the S&P and Russell Emini Futures (the values in these reports can easily be adapted for SPY [*10] and SPX markets [small premium adjustment]).   Even if you do not use this type of analysis, you should know about it, because large numbers of very well capitalized traders use this approach. As a result, it is likely in your best interest to know and understand it. I have written about these techniques here: http://markettradersjournal.com/volume-profile-analysis/ and elsewhere in this blog.  I also advise reading the notes for both markets as they are related markets. Differences between them can provide clues to what is really going on (though I do not cover cross market analysis in this report). The report is for use on the date posted above based on profile numbers from the trading day before.

For the Emini S&P (ES) Futures:

Overall Outlook:

Today we closed in value.  This is bearish. The value area was lower and wider. This is bearish but with a hint of a ranging market.  We have somewhat of a B, bimodal shape. This indicates continuation and could be bearish. Therefore, a lower open tomorrow will be quite bearish.

Bull Scenarios:

If we open above 1313.00 look to buy at 1313.00 or 1309.25 areas.

If we open above 1319.00 then this is even more bullish and may cause a runner to the upside started by stops being hit.

Bear Scenarios:

If we open below 1302.50 look to sell at 1302.50 or 1309.25 areas.

If we open below 1297.25, then this is even more bearish and may cause a runner to the downside started by stops being hit.

Neutral Start Scenario:

If we open between, 1302.50 and 1313.00, then ranging is more likely.

Always be cautious of the impact of reports that come after the open of the day.

Special Observations:

Notes: Today we took out 2 VPOCs; one lower and one higher. Note how reversals occurred at these levels.  This suggests a ranging/auctioning market.  There is a virgin point of control at the 1325.75 and 1357.50 areas. Watch for potential reversals at these areas if we get there.  Above the 1337.50 area volume drops off at a high rate with a LVN at 1343.25. Keep an eye on these areas.  In the more immediate analysis, we are trading just below the HVN (1314 area).  Trading below this level is bearish.  Beware of the 5/18 low at the 1290 area.

For the Emini Russell (TF) Futures:

Today we closed in value.  This is bearish. The value area was lower and wider. This is bearish but with a hint of a ranging market.  We have somewhat of a B, bimodal shape. This indicates continuation and could be bearish. Therefore, a lower open tomorrow will be quite bearish.

Bull Scenarios:

If we open above 762.10 look to buy at 762.10 or 757.60 areas.

If we open above 765.00, then this is even more bullish and may cause a runner to the upside started by stops being hit.

Bear Scenarios:

If we open below 752.90 look to sell at 752.90 or 757.60  areas.

If we open below 749.70, then this is even more bearish and may cause a runner to the downside started by stops being hit.

Neutral Start Scenario:

If we open between, 752.90 and 762.10, then ranging is more likely.

Always be cautious of the impact of reports that come after the open of the day.

Special Observations:

Notes:  There is a virgin point of control at the 778 and 788.70 areas.  Today we cleared out the lower 750 VPOC and went higher to test yesterdays POC and then went down again. This is a ranging market.  We are currently have a HVN on the composite at 763 and 754. There is a LVN between them at 756 or so.  Trading below 754 is particularly bearish.  Beware of lows going back to the 18th. Above 766 is bullish.

Remember to check the Open Report on the Nindicator YouTube Channel just before the open of the day (you should subscribe so you are notified):  http://www.youtube.com/user/Nindicators?feature=mhee

Compare this report and the Open Report with your own analysis.

Note: These reports may vary a bit from Nindicator reports as they may under various circumstances use slightly different calculations.

 Leave a Reply

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>


− six = 1

Commodity Futures Trading and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to Buy/Sell futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this web site. The past performance of any trading system or methodology is not necessarily indicative of future results.