- Period: 15/12/2022 – 16/02/2023
- TF: Day
- Chart: Volume Profile
- Add: Indicator VWAP + dev1/dev-1
- Add: OI indicator
- Total Histogram: Volume Delta
I made my first trades on an e-mini S&P 500 futures contract.
Even though it was a long time ago, even now I remember the emotion I felt at the time.
The volatility of the index in 2007 was quite different. If you could take a trade with an open-close price difference of 5 dollars – it was like winning the lottery.
I can’t remember whose words, but the phrase is “The most valuable thing we have are our memories”.
Let’s move on to a review of the S&P 500 Index.
The March contract expiration is very soon – 17.03.2023.
It means that there are 3 weeks left till the moment when all participants should close their trades.
It is worth to keep it in mind in your calculations and analysis.
On the slide above, pay attention to the volume histogram by price, namely the range at number 4. The maximum value of the traded contracts is now set at 4130, while recently it was at 3864. This means that large participants began to shed some of their positions, in addition, the price is trading at the maximum of the current contract.
This is also indicated by the Open Interest, which is indicated on the slide above the lower histogram by the yellow line. From February 2 to 7 the open positions declined sharply.
This was the reason for the correction from 4200 to 4100. For the record, noted the area of resistance that formed during this period, but its reliability is doubtful. As the volume sales were not for opening trades but for fixing purchases, which means that such levels are unlikely to be held by the big players.
The main trend of the current contract, is not yet complete. Note that once the price went down to 4080-4100, the nearest support level, the buyers on February 10 pushed the price in the opposite direction. While the price remains between support and resistance, the number of open positions are starting to increase.
The VWAP is now at 4000, which is the target price for an acceptable corrective pullback in case of bearish activity.
As long as the 4080-4100 level continues to work as support, there is a high probability of an update of the high.
Good luck and profit!