ESM22 Daily Debrief 04/08/2022
Market Overview
All equity indices finished last week in the red. The Dow was the only index to have a positive day Friday, but it still was down compared to the previous week. Bonds continued to fall, with the 30-year T-Bond falling for 6 consecutive sessions.
Here are some of Friday’s closing prices.
Top-Down Analysis
Monthly Time Frame: Here are the highs and lows of the past two months, which are currently OTFU. The February high was 4586 and low was 4101.75. The March high was 4631 and the low was 4129.5.
Weekly Time Frame: ES is OTFD for the past two weeks. 4444.5 and 4415 are weekly swing lows on the downside. 4588.75 was the prior week’s high.
Daily Time Frame: Since hitting a high of 4631 on 3/29, ES is trending down on the daily chart. ES has been range bound for the last three sessions. 4444.5 has been support at the lower end of the range. This exact price level has been tested twice and longs have defended it both times. The 20-period Fib 68.7 (4442.67) is also in this vicinity. 4528.75 was the upper range of the channel, but more recently ES hasn’t been able to get above 4519.75.
Performance & Technicals
5-Day Performance
Technicals
ES Volume Profile for Friday:
ETH VAH: 4511.75
ETH VPOC: 4498.75
ETH VAL: 4485.25
ES RTH Market Profile for Friday:
RTH VAH: 4508.25
RTH POC: 4500.25
RTH VAL: 4483.25
Prior Day RTH High and Low (Tomorrow’s T+2):
T+2 High: 4517.25
T+2 Low: 4444.5
Here is a chart of the past five sessions with ETH Volume Profile:
Here is a chart of the past five sessions with ETH/RTH Market Profile and Volume Profile:
Session Recap
Electronic Trading Hours (ETH)
Overnight Session:
At Thursday’s close, wholesale inventory was long above VWAP. Friday’s ONO was inside of yesterday’s price range, below the T+2 high and above the ETH value area. Overnight inventory was long above VWAP and Thursday’s settlement close. Price action stayed above the prior day’s value area for the entire ON session. 4491.75 was holding support for most of the ON session. In the hours leading up to RTH, inventory was pushing the market down. ES broke the 4491.75 support level and eventually below VWAP. Volume during Globex was lighter than it’s been for the past few sessions.
ONO: 4494.75
ONH: 4519.75
ONL: 4488
ONRange: 31.75
Regular Trading Hours (RTH)
Initial Balance (IB) Session / US Open:
RTH opened inside of Thursday’s price range, a point or two above the prior day’s VAH and below the T+2 high. There were no gaps with Thursday’s RTH range. Initially, longs could not get back above the short-term support level from Globex. In A period, shorts drove the market down several points below the prior day’s POC. Short sellers had their bids above 4468.75 and supply could not push the market beneath this level. The B period of the IB session, traded in a range above here with a swing high at 4485. As IB was coming to a close, buyers gained some momentum and pushed the market long towards VWAP.
IBO: 4489.25
IBH: 4491.75
IBL: 4468.75
IBRange: 23
Remaining Session:
After an initial lull of about 20 mins post-IB, the offer could not absorb the strength in buyers and ES shot up. The auction exited Thursday’s value area and surpassed VWAP. It got up to 4512.25, before some supply was met. ES traded in balance before longs attempted and failed to surpass the ONH. Topping out at 4516 during the lunch hour, demand diminished and shorts sank ES for the ensuing two hours, getting back inside the previous day’s value area by one point. Responsive buying gave ES a brief jolt before wearing off in the final hour of RTH. Shorts came and sold the market down nearly 30 points before shorts covered at the US close to stabilize price.
Links
Block, Blockstream and Tesla partner up to build a pilot solar-powered mining facility in Texas.
Byrne Hobart discusses some of the challenges with regulating big tech.
Sam Ro discusses that when headwinds occur, most investors ask themselves the wrong question.