Tuesday, 18 October 2011

Trade ES Starting From The RTH Close

I don't trade much after lunch in RTH. By then I've been at my screen over a 12 hour period (often not continuously). However, I do look at the charts, especially Market Profile, when I start my day at about 5 am in France. There are lots of you out there who trade in that time zone - after RTH - so I thought a few comments may be useful after looking at the charts from the Close of RTH on 16 Oct up to about Lunchtime in London (about 7 am NY time).

This is the Profile:

I have broken out the TPOs of the current 24 hour Profile so you can see the half hourly action.

Price closed yesterday at the end of RTH at 1194.00 ish. Had I been trading starting at that time, I would mark out the key points on the Profile chart: 

I would expect price to rally back to 1196.50, the bottom of the VA of the split of the last distribution. It did just that but much later. 

I would watch for what happened at the low of 13 Oct - 1193.25, and,

 1191.00, the TPO VAL of 12 Oct. 

The next point is 1187.oo which is the Volume VAL of the same day.

The market action at the close of RTH looks like that continuation down is likely and I'd enter on the break down with good volume. I then have a series of places to cover, buy and sell at. I need to look at what happens at these key areas. My bias is down until I see good buying coming in. That did happen at the Volume VA low, twice. 

Planning the trades out in advance is one way of not being surprised.


  1. Hey EL I spent the last 2 days trying outside in trades because I got my Context wrong. Can you point me in the right direction? (Sim Trading)

  2. Hersh, its all in the blog. Look for something to lean on and only sell over bought and only by oversold. Watch out for trend days as you casn't stand in front of the train. Time of day can make a difference. Outside in trades when the market is way out of balance is not usually the time to do them eg, just after the open unless the mkt has gone in the wrong direction temporarily. Hope this helps..