The chart outlines important levels to watch. I labeled them based on the market profile theory and market structure. The price is at important resistance and stuck between 2 major monthly High value nodes. The last daily bar shows a directional move off the Jan 2019 High value node. This is a typical market action indicating an acceptance of the old value and readiness to retest the previous value around 6880 area. So why the current resistance is so important? It's a confluence of several levels:
- November 2018 High value node
- Downtrend trend line
- VWAP originated from October 1, 2018 selloff
A decisive break of that resistance is going to set a tone for the remaining 2019 and confirm the buyers dominance.
What could spark the break? Next week is supposed to be quite eventful. Major components of the index are reporting their earnings, and FOMC announcement.
A failure to break the resistance may lead a return back to Jan 2019 High value node 6680 area where the previous value was accepted by both sides. A much stronger selloff would lead to retest Jan 2019 low.
Regardless which scenario is going to play the volatility spike is expected. Both sides will be fighting for the daily/weekly/monthly candles close.
01/27/2019
- November 2018 High value node
- Downtrend trend line
- VWAP originated from October 1, 2018 selloff
A decisive break of that resistance is going to set a tone for the remaining 2019 and confirm the buyers dominance.
What could spark the break? Next week is supposed to be quite eventful. Major components of the index are reporting their earnings, and FOMC announcement.
A failure to break the resistance may lead a return back to Jan 2019 High value node 6680 area where the previous value was accepted by both sides. A much stronger selloff would lead to retest Jan 2019 low.
Regardless which scenario is going to play the volatility spike is expected. Both sides will be fighting for the daily/weekly/monthly candles close.
01/27/2019
Note
Today the market played the downside scenario outlined above and retraced back to January high value node. It parked slightly above it. The RTH session was very balanced and it spent time mostly within last Thursday range. It came close to Thursday’s RTH POC. From the market structure perspective nothing has changed. I don’t anticipate any significant move until we hear from Apple and FOMC conference.01/28/2019
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.