ESM22 Daily Debrief 04/20/2022
Market Overview
Netflix fell some more today and took other tech stocks with it. The S&P 500 and Nasdaq both bled today as a result. The Dow, Russell and long duration bonds all finished positive. Tesla reported earnings after-hours and absolutely crushed it.
Here are some of today’s closing prices.
Top-Down Analysis
Monthly Time Frame: -1.27%
April is an inside candle with all price action inside of March’s price range. The March high of 4631 and low of 4129.5 are both untested.
Weekly Time Frame: +1.95%
ES is currently OTFD for the fourth week in a row. Last week’s high of 4491.25 and the prior week’s high of 4588.75 remain in tact. To the downside, the low from the week of 3/14 @ 4129.5 also stands.
Daily Time Frame: -0.08%
Today’s session broke through the upper channel from the previous 5 sessions. ES is now OTFU during the last 3 sessions. 4491.25 and 4519.75 remain previous daily highs which are still in tact (although maybe not for much longer). To the downside, the recent lows are 4371.75, 4355.5 and 4320.25.
Performance & Technicals
5-Day Performance
Technicals
ES Overnight Volume Profile for today:
ETH VAH: 4480.5
ETH VPOC: 4476.5
ETH VAL: 4442.5
ES RTH Volume Profile for today:
RTH VAH: 4472
RTH VPOC: 4455
RTH VAL: 4454.5
Prior Day RTH High and Low (Tomorrow’s T+2):
T+2 High: 4467
T+2 Low: 4385
Here is a chart of the past five sessions with ETH/RTH Volume Profile:
Here’s a TPO chart of today’s session with ETH/RTH Market Profile:
In RTH, ES had single prints below 4447.50. Above 4481.75, there was some excess.
Session Recap
Electronic Trading Hours (ETH)
Overnight Session:
Wholesale was long the majority of yesterday’s RTH. Inventory began to correct towards yesterday’s close but was still long above VWAP. The ONO was inside of yesterday’s price range and value area (close to the VPOC). Inventory in Globex was in balance for the for the first ten hours. Traders had put in volume on both sides of VWAP within a tight 15.5 point range. Roughly two hours after the London open, supply started shutting out and long traders elevated the price to escape the ON price channel and erase yesterday’s VAH and HOD. Heading into RTH, overnight inventory began to stabilize near the ON highs. A poor high was left as well as two sets of single prints (4448.75 - 4453.5, 4465 - 4472.5).
ONO: 4441
ONH: 4480.5
ONL: 4432.75
ONRange: 47.75
Regular Trading Hours (RTH)
Initial Balance (IB) Session / US Open:
The RTH open was above the T+2 high. It was also above yesterday’s VAH and HOD, leaving a gap up of 10 points. At the open, ES initially rallied higher and erased the ONH. The long traders could only hold the rally for about 2 minutes before supply took hold at the new high. Short traders slowly moved the market down. After about 10 minutes, supply completely absorbed all the buyers and ES sank back into yesterday’s price range and value area, and past the first set of single prints from Globex. ES continued to chop lower and about 30 minutes after the opening bell, the auction hit the IBL where supply shut off. Buyers hit the offer before the auction could test yesterday’s VPOC. ES slowly crept higher gaining back nearly 50% of the session’s losses from the first 30 minutes. The RTH open left a poor low @ 4452.50 and single prints/excess above 4469.25.
IBO: 4477.5
IBH: 4484.25
IBL: 4452.5
IBRange: 31.75
Remaining Session:
Following the US open, long traders continued to hammer the offer and absorbed any and all backfill. ES moved above the previous day’s price range and several points shy of the IBH before supply strengthened. For the next 3-4 hours, ES traded like a roller coaster inside a 25 point range, all of which was contained inside the IB period’s range. As the session approached the final hour, ES sank below VWAP and took a peek below the area underneath the IB price range. Supply ran out roughly 10 points beneath the IBL before buyers moved the auction back up and settling around VWAP.
Below is a closer look at the RTH session from today.
Links
A thought provoking piece from Sahlil Bloom on time and mortality.