Here are the profile charts of CrudeOil and Natural Gas
CrudeOil broke through the lower balance area yesterday and reaching previous support here.
The OrderFlow does not show any big buying interest here, and we will watch for a change around the purple High volume nodes.
Natural Gas :
Earlier this month NG had put in a multi day balance between 173 and 179.
That was broken lower on news flow but subsequently the market went through the entire balance and is currently poised at the upper end of the balance.
A move above the balance can bring 183 on the upside.
What can also happen is a rotation below to 173.
Here's a check on crude for the trading sessions in FEB
The chart above shows a market getting acceptance around the 5139 mark with closing prices and POC's around that zone.
This is a market in balance with a move to 5070 being rejected .
The next step was to probe higher which happened on the 11th. This imbalance was quickly restored through a 2 session DD profile on the 11th and the 12th which showed the market accepting higher value.
However there was not a lot of progress seen above 5280 with orderflow finally showing single print sellers on the 15th.
The current price stands in the low volume zone created on the 11th and is likely to strive for acceptance here with a value area being created above and below.
Buy the dips to 5120 and 5139 and sell all the rips to 5230- 5245.
Sideways consolidation to continue.
Here's the chart we discussed in the trading room a few minutes back
The chart shows the value area for the move from 4770 to 6111 in green ( smaller profile) in the Nifty against the larger backdrop which is balanced.
We are focusing on the activity from June 2012 and from the level of 4770.
As can be seen we had 4 major uptrends each of which measured 578, 416, 599 and 563 points respectively.
The downtrends against these moves measured 316, 232 , 267, and 257 points respectively.
Purely from a Profile perspective it still shows the buyer in control on this time frame.
From the highs the current lows to Friday measured 257 points and well within the range of correction seen for this uptrend.
We continue to see 5816 ( red line on chart) and Friday's lows near 5866 as important levels for a longer term perspective.
Largest volume traded for the move is at 5684 which when violated will break the uptrend.
A confirmation of resumption is now above 5945 with a target of 6300 intact as per this chart.
The markets have been putting in a narrow range for these past few sessions.
For most people it's been a boring week of trading till date but the avid market profiler would be watching this sideways development for cues on the next leg of imbalance.
We have been following this chart :
The market broke out of the January balance by leaving a selling tail on the 31st.
This was tweeted by Viren for his followers on the 31st . You can find that link here- https://twitter.com/VirenRasquinia/status/296916341288493056
Momentum came in from the lows of that day 1 session later as initiative selling again added to the momentum.
That imbalance ended with the market balancing on the 5th and we have seen an extension of that balance ever since.
The range is defined between 5940 and 5994 till this noon.
At some point of time this balance will end and the market will start a new road to price discovery.
As an auction player you would note the tussle between buyers and sellers in this balancing mode and take longer term bets on a break only.
Judging orderflow is one way to know which side the market will eventually break out of.
So far based on what we have been observing in the trading room, there aren't many buyers seen at lower levels. Whilst that can change as the market continues to balance that change has to be driven by initiative activity on the part of buyers. That will happen only when they see the current price as value.
Till then the seller appears to be in control and is likely to drive the price lower.