Wednesday, October 20, 2010

10/20/2010 Up Auction In Tact

Good evening traders,

First let me preface this article by saying that I am not an expert in market profiling. This blog is very much about me learning and I learn best by writing things down and applying them in real time situations.

The chart above is for the last two trading days with market profile attached. I used the free GomiMP indicator to create these charts in Ninja Trader. You can find the indicator in the Ninja Trader Forums. Low value nodes (LVN's) are marked with a red line, High value nodes (HVN's) are marked with a green lines, and the value area is between the two blue bars (VA). I highlight the point of control (POC) as the white bar on the profile.

Yesterday's closing price was below value. With the gap up open this morning my immediate expectations were for buyers to bring price back up to yesterday's value area. The open went just as expected and yesterday's POC gave a good short entry. Profits could have been taken as we approached yesterday's LVN and the opening print. Buyer's once again stepped in drove price above yesterday's range. after a brief rotation the market resumed higher breaking out above yesterday's high. At this point long targets were the LVN from 10/18. That price was 1179.00 and provided numerous opportunities to short throughout the afternoon. The market closed towards the mid point of it's value range and I expect higher prices tomorrow.

Some areas where I would like to do business on the buy side tomorrow are 1169.00-1171.00. There is a confluence of today's value area low, the LVN's at 1169 and 1171, and yesterday's POC should dry up the selling.

Judging prices above is a little more tricky because I have to rely on other people's charts. I do not have data back to the beginning of May. If any readers have tick data back that far back please feel free to donate it to me! From what I can see (posted on and other sources like twitter) there is resistance at 1186 area and an open gap from May 3rd at 1089.50. Those would be area's for me to take profits on long positions and possibly initiate a short.

Like I said at the beginning, I'm not an expert on Market Profiling. I am reading, learning, and applying what I already know. The blog will help me keep tract of my progress and add more transparency to my trading. I post live trades on twitter. They are not recommendations to buy or sell anything. Thanks for reading the blog. Please help me out by following the blog and clicking the adds. It only takes a second. Good luck tomorrow


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