ESM22 Daily Debrief 04/21/2022
Market Overview
Fed Chair Powell all but guaranteed a 50bps rate hike at the Fed meeting next month. After a strong start to the day, equities fell off a cliff. ES dropped 100 points off the session high. It was joined by the Dow, Nasdaq and Russell, all of which also tumbled.
Here are some of today’s closing prices.
Top-Down Analysis
Monthly Time Frame: -3.46%
April is an inside candle with all price action inside of March’s price range.
Nearby Highs: 4631
Nearby Lows: 4129.5, 4094.5
Weekly Time Frame: -0.31%
Today’s peek above 4500 erased last week’s high of 4491.25 to end OTFD.
Nearby Highs: 4588.75
Nearby Lows: 4129.5
Daily Time Frame: -1.46%
Today’s dive erased yesterday’s low to end OTFU. The 4491.25 high was erased during the initial move up during the US open.
Nearby Highs: 4519.75
Nearby Lows: 4371.75, 4355.5, 4320.25
Performance & Technicals
5-Day Performance
Technicals
ES Overnight Volume Profile for today:
ETH VAH: 4498
ETH VPOC: 4495
ETH VAL: 4477
ES RTH Volume Profile for today:
RTH VAH: 4471.5
RTH VPOC: 4390
RTH VAL: 4380
Prior Day RTH High and Low (Tomorrow’s T+2):
T+2 High: 4484.25
T+2 Low: 4443.5
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:
Globex had a double distribution. RTH had a long thin profile. Today’s RTH session had multiple areas with single prints:
4503.25 - 4509
4485.25 - 4487.5
4477 - 4477.75
4460 - 4472.25
4453.5 - 4455.25
4406.25 - 4411.75
Session Recap
Electronic Trading Hours (ETH)
Overnight Session:
At the prior day’s close, wholesale had taken inventory short. The ONO was inside of yesterday’s price range and value area. It was also a point above the T+2 high. Inventory in the overnight session was long. The auction moved against the ONO by 1/2 point and took out two upper swing levels in Globex. The majority of volume in Globex occurred in the 4495 price area. Although in total volume for the session, it was less than the previous two ON sessions. A poor low of 4 time periods formed at the ONL.
ONO: 4468
ONH: 4498.25
ONL: 4467.5
ONRange: 30.75
Regular Trading Hours (RTH)
Initial Balance (IB) Session / US Open:
The RTH open was above yesterday’s price range, which created a gap of roughly 10 points. It was also above the T+2 high by nearly 30 points. At the opening bell, long traders lifted ES above 4500. Inside the first half hour, ES backfilled and could not get down to the IBO. Long traders then elevated ES higher to a new IBH and encountered supply. Shorts then steadily sank ES while absorbing any and all responsive buyers. Eventually ES erased the IBO and dropped below VWAP to partially close the gap created at the open. Longs stepped in before the gap was fully closed to push the auction back above VWAP. During this IB period, 4500 had the most volume and was the VPOC.
IBO: 4494.5
IBH: 4509
IBL: 4487.75
IBRange:
Remaining Session:
Following the IB period, meaningful supply sank ES below VWAP and never looked back. Trapped longs sold on the way down to further ignite the selloff as ES dropped more than 100 points from the IBH into sub 4400 prices. In the US closing hour, there was some volatility as short covering induced brief rallies. These weren’t sustained as heavy supply kept absorbing the bid to keep the auction below 4400, while creating lower highs in the process. ES ultimately fell below the T+2 low momentarily and settled a few points above it.
Below is today’s RTH session:
