From Pre Market Prep the LIS I had was 3700 (check it out here https://www.buymeacoffee.com/post/edit/1275801). A period wasted no time breaking through that LIS and never looked back. B period continued the downward pressure and we saw sellers were still in control for the rest of the day. C period opened and we couldn't get back into the Overnight Range. We drove down to the 3650 level (3659) to be exact. D period opened and could not take out C low, this MGI (market generated information) could have taken the long trade with stop at C low for a 30 pt swing but who would have known that would happen. D High also could not take out C high and get into Overnight range (Selling pressure still above 3700). E period opened and the range tightened we had a b profile forming at the time. Which could tell us that Longs are liquidating and position is being built. In today's market conditions it felt more like long liquidations then institutions making a position. F period ran the stops of the E low but did not take C,D low and rotated up, same as previous TPOs we never took out the E,D,C, highs to get back in Prev range. G period started the Inventory correction as it took F high by more then 2 ticks. This inventory correction also stopped the OTFD (One time framing down) We never took out any other highs just the F high. H period opened and volume was being put in around the 3670-3680 area. To me it felt like they were getting ready to run the highs, I took 3 trades in this area and was stopped on all three. The idea was right but I was too fast on the trigger.
The trade Idea:
With the amount of volume in the area of 3670-3680 I thought we would be able to run the highs and get back in to the overnight range, I entered each trade at the top of H period and each trade was stopped out on a back fill and seeing sellers above 85 at the time.
The setup in this trade- Volume building up and trying to catch the stop run
H period took out the highs and continued the run up it could not however take out the C high or get back into Overnight range (another failed attempt by buyers). I period opened and buyers failed to get continuation as well (H completed the inventory correction). I proceeded to take out the all the lows except the C low. With the inventory correction completed and the Volume built up overhead when J period opened we had continued selling pressure and J flushed all the way down to 3652.25. K continued OTFD and we tested 3642. Short covering ramped up at the EOD in L,M period and we came back to 3674-3679 levels.
Overall outlook:
Sellers are still firmly in control as we Still have gaps above and Single Prints from Overnight session. Today's profile looks to be balanced but this is long liquidation. We have Quad Witching tomorrow let's see what the witches are brewing. For the overnight session I would want to see us hold 3667-3676.50 area. if we could hold over 3695 and 3700 may be an interesting Friday for buyers. If we can't hold 3667 and test 3650-3642 we may trade down to 3622 and tickle 3600. We are heading into a 3 day weekend as well so it will definitely be interesting to see what turns out.
As always Trade safe, use stops, until next time.....