Today Crude Oil offered us two good opportunities with good risk-reward potential.
There were a few resistance levels right from the start that I have mentioned in my twits this morning. Yesterday's low at 44.41 and the high of the lower distribution from yesterday's profile at 45.19.
Furthermore overnight inventory was short when the bell rang this morning as we opened on a gap down. The Gap rules were in effect.
What are the gap rules ?
Trading day review for ES.
ES was relatively quiet today. We had Overlapping to Higher value with small volume right inside the 19 day balance.
On hindsight we had two good trades today and I must admit that I saw only one as the market was developing today. But It is nice to show these trades backed with Market Profile structure evidence. This is what we call Ruling reason and it is extremely difficult to grasp when first face with it.
Here is how we should have traded crude oil futures today based on Market profile Auction theory. From a proud student of Jim Dalton.
Today was the day of the oil inventory number. It is quite dangerous to trade before this number as the market usually exibits low volatility and just wait for the number at 10:30 EST. If you don't trade the number there were only a few opportunities offered by the market today. The first good opportunity came around 11:00 when the market rejected the overnight high.