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The Bund was flat on the day. The market staged a recovery from its lowest levels and briefly took out the highs from Tuesday. However the market remains under-pressure and eventually drifted back to the cash close levels from Tuesday going into the late afternoon. The market seems set to sell-off again, if yesterday’s highs hold we would expect a break down to below the 144.22 level. This should pave the way for a test for the medium term pivot at 143.87-95. A close above yesterday’s highs could be important from a short-term perspective and a move through here could spark a deep short-covering rally.
Above average volume and above average range. An up day. VPoC (144.71) is down. VA is very wide and encompasses the three previous VAs.
From the open market moved up to 144.96 within the first 30 minutes on low volume and then dropped to its LoD (144.53) at around 13:00 CET. A little pullback started. The negative Jobless Claims report released at 14:30 CET (=08:30 EST) and the negative Phil Fed Survey released at 16:00 CET (=10:00 EST) pushed the market up to its HoD (145.36) at around 17:00 CET. Market then moved sideways till the close.
The VPoC in the 5-day volume profile chart has not changed.
Six levels of Resistance
• 146.53
• 146.16
• 146.05
• 145.74
• 145.55
• 145.46.
Two levels of Support
• 144.87 (VPoC, VAH=145.01, VAL=144.55).
• 144.21.
Stock markets are down.
The daily volume profile is a two-node distribution. One node around the VPoC (144.71) the other around 145.31. The TPO chart shows its PoC at 145.27. In the TPO chart the upper node fills the thin area between 145.37 - 145.27 from last Friday.
Intraday the market found support at 144.52 - a level from 03-26 - and resistance at 145.27 - 145.31. A level from last Friday.
There are two reports scheduled for tomorrow. Consumer Confidence at 15:55 CET (=09:55 EST) and Leading Indicators at 16:00 CET (10:00 EST).
The US reports today are not quite as negative as they look at first sight, the initial reaction of the stock markets was a bit subdued. They started to drop later.
It remains to be seen whether today's up move was just short covering or buying. Range and volume have not been big enough to look like "capitulation". But the decline from the HoD was pretty small on declining volume, should have been larger if it was just short covering. To switch the trend to up again market should move above 145.54.
Monday is a Holiday in large parts of Europe. Eurex and Frankfurt stock exchange will be open.
I think bunds will open in the range of today's last hours and drop on low volume till stock markets open (09:00 CET). If stock markets continue to decline bunds should move up. The level of 145.48 will offer resistance.
If bunds move up right from the open - above today's high - there may be a chance for a short position.
Buyers won, an up day after reports, we are accepting value higher and heading back to close the gap from May 10. Thinnish areas at 145.38 and below 145.09. Any acceptance above or below those levels respectively may tell the next direction.
A coulple of things to add to the posts of my dear colleagues.
On the 1 day graph, wa can see that despite the upward move after 2.30 pm, Bund future contract was not able to get our from ICHIMOKU cloud and more important, Chikou span is just below the candle line.
I therefore still see Thursday move as a retracement, actually 50% from the high end of May 9th doji, rather than a reverse.
On ut 4H graph, I still see the Bund future market in a downard broadening structure, with prices just below the resistance oblique.
I might therefore have a bearish biais in my trading tomorrow. For instance if market beguns the day rising with small volume and stays below UT 4H MA 44 and May 10th gap, I will look for an entrance on short position, particularly if in the course of the day, prices go below the opening level.
I would be much more cautious on short positions if the market begun to drop with small volumes. Dropping with big volumes would however be a clear signal that the upward potential is exhausted.
145.50 (MA 44) is a first resistance level and May 10th gap a second one.
On the support side I 45.00 is a first obvious one and then 144.40/50 area. Below there is obviously our old friend 143.93.
The Bund was firmly higher on the day. The market held a move down to the 144.50 handle in the morning before rallying catalyzed by the bad economic data. The market retraced back to the 145.37 level and a move and close above here could signal that the recent run lower has run its course and we would then expect a decent leg higher initially sparked by a short-covering rally. The 146.23-36 area is the key pivot and above here should see the bulls re-assert for an extended run higher. Failure to back below the 144.96 level could see the Bunds give up yesterday’s gains.
Friday saw a little below average volume and below average range. A down day. VPoC (145.40) is up and the highest of the last 6 VPoCs. VA sits well above Thursday's.
From the open the market moved up on lower than average volume. Volume grew while the market moved up to its HoD (145.74) at around 12:30 CET. From here it started to drop and moved down to its LoD(145.13) at around 21:00 CET.
The weekly chart shows an up week with below average range but above average volume. The up trend has weakened but still looks ok.
The VPoC in the weekly volume profile chart has dropped from last week's 145.53.
Six levels of Resistance
• 146.53
• 146.20
• 145.74
• 145.53 (2x)
• 145.34
Two levels of Support
• 144.85 (VPoC, VAH=145.08, VAL=144.49).
• 144.55.
Stocks - especially the US markets - continue to make new all-time highs.
The daily chart looks inconclusive: such a pattern as made by Friday is often seen at the start of an up trend but here it looks similar to the action on 2013-05-09. Then a strong drop followed the next day.
The daily volume profile shows a thin tail below 145.30. Part of it is due to low volume when the market opened and rose from the low of the first 30 minutes. During the decline late in the day (after 18:30 CET) volume was also thin. Besides around the VPoC there is also a node around the VAH (145.60).
Intraday the level between 145.60 - 145.67 offered resistance while 145.31 offered support. OI has been dropping almost constantly since the end of April and is now at a level below that after the rollover. Looks like longs and shorts are liquidating positions.
Monday is a Holiday in large parts of Europe. Eurex and Frankfurt stock exchange will be open.
There is only one report scheduled for tomorrow: Chicago Fed National Activity Index at 14:30 CET (=08:30 EST).
The last hours of Friday do not suggest a continuation of the down move. OTOH it looks a bit unlikely that such a move will reverse immediately.
So I think the market will open with little change and either move up on slow to normal volume or drop on low to normal volume at least till 09:00 CET. It will have to be seen whether this up move in the stocks continues. 144.94 may offer support, 145.48 may offer resistance.
It may happen that we will have to wait till the US markets open to get some guidance.
The Bund was flat on the day. The market traded through Thursday’s highs, moving to the highs from the Friday prior. The market was unable to close the daily gap at 145.77 before paring and thus should remain weak below here. A close back below Friday’s lows could signal a sharp run lower in prices. A close back above the 145.77 level and even the 146.23-36 area would allow for a resumption of this month’s bullish run. Thus we are in a crucial area for the market at the moment.
Well below average volume but average range. A down day. VPoC (144.90) is down. VA has dropped too.
The market opened on higher than average volume and dropped 27 ticks during the first seven minutes. Then the market made a pullback and dropped again, but rose up to its HoD (145.33) at around 15:15 CET. From here it started to drop - first slowly, then accelerating - to its LoD (144.65) at around 17:50 CET. A pullback till the close followed.
The intraday moves are comparable to those of Friday: market is lifted up and then pushed down. The first few minutes look like a follow-up to Friday's selling.
The VPoC in the 5-day volume profile chart has not changed.
Six levels of Resistance
• 146.65
• 146.20
• 146.06
• 145.74
• 145.53 (2x)
• 145.34
Two levels of Support
• 144.85 (VPoC, VAH=145.20, VAL=144.46).
• 144.55.
Though the US markets made new highs they finished the day (slightly) down.
Since the low volume today is due to a Bank Holiday it should not be used in interpreting the daily chart. The chart pattern is inconclusive: It looks slightly bullish but the market could just as well head for a new swing low (below 144.22).
All-in-all the daily volume profile looks balanced.
Intraday the level 144.90 - and later 144.78 - saw some buying. Between 145.23 - 145.31 sellers stepped in.
There are no reports scheduled for tomorrow.
The last few days the OI has risen a bit, so the up move since last Tuesday may indeed be buying. The level 144.93 - 145.00 looks crucial to this development: a move back above it should stimulate further buying. The market has dropped down to the buying tails of last Monday and Tuesday: a drop below 144.57 could trigger further selling.
Since reports are rare tomorrow, the market will probably move slowly and wait for the stock market to open (09:00 CET), maybe even till the US markets open.
Thin market today due to hols.
Balanced profile with extension on both sides and buying as well as selling tails. Neutral day may signal some larger move to come. Close almost at STF POC. Let's see tomorrow.
