Last week the market broke out of Balance to upside, made new highs but has settled back within a 5 week balance. When a balance breakout fails the market usually tends to test the other end of balance. The destination trade now becomes 1834 and below that the 1822-23 level. See weekly chart below.
Friday, following the employment number, the market rallied to new all time highs in the pre-market session. However, at the Open, the market could not even tag the overnight high at 1892.50 and we saw a huge liquidation break - a sign that the market had gotten too long. Friday's profile shows 3 distributions. Treat each distribution as a separate day. For Monday, Overlapping to lower Value relative to Distribution #3, targets the naked POC's at 1854.75 and 1841.25. We also have a poor low at 1845. The initial destination is low of 3/27 but that does not mean it has to go there to the tick. Value building within Dist #3 keeps the market in Balance.
Friday, following the employment number, the market rallied to new all time highs in the pre-market session. However, at the Open, the market could not even tag the overnight high at 1892.50 and we saw a huge liquidation break - a sign that the market had gotten too long. Friday's profile shows 3 distributions. Treat each distribution as a separate day. For Monday, Overlapping to lower Value relative to Distribution #3, targets the naked POC's at 1854.75 and 1841.25. We also have a poor low at 1845. The initial destination is low of 3/27 but that does not mean it has to go there to the tick. Value building within Dist #3 keeps the market in Balance.
