Jump to content

Welcome to the new Traders Laboratory! Please bear with us as we finish the migration over the next few days. If you find any issues, want to leave feedback, get in touch with us, or offer suggestions please post to the Support forum here.

  • Welcome Guests

    Welcome. You are currently viewing the forum as a guest which does not give you access to all the great features at Traders Laboratory such as interacting with members, access to all forums, downloading attachments, and eligibility to win free giveaways. Registration is fast, simple and absolutely free. Create a FREE Traders Laboratory account here.

Soultrader

Overnight Session: Looking at globex high & low

Recommended Posts

On top of knowing where the previous days high and low is, it is important to watch for the globex high and low as well. These levels can act as key support and resistance point. One strategy is to go long at the globex low and short at the globex high.

 

Any break above the globex high is a long signal and any break below the globex low is a short signal.

 

One important pattern I have been seeing recently is whenever prices move below the value area during the overnight session just to have it pushed back into value. This level below the value low pivot acts as key support during the trading day.

Share this post


Link to post
Share on other sites

Here is a good example of an overnight support. The markets trade right below value low just to find support to push prices back into value.

 

Take a look at the long red bar at the far right edge of the chart. The tall wick shows price rejection below the value low pivot. This will be a key pivot to watch going into the trading session. If the premarket action does hold this pivot, this is a good indication that price will not trade below the value low pivot. Also, instead of shorting the break of the value low pivot, you need to understand the globex low made. This will act as support.

 

A safer setup to trade the break of the value low pivot is to short the break of the overnight low.

Share this post


Link to post
Share on other sites

After prices held the globex low at the value low pivot, we had clear indication that price was going to trade within or above value.

 

In this example, we had prices in a decent uptrend. Overnight session price acceptane vs rejection can act as key information to guide you in your trading day. Notice the 100+ rally from the value low pivot.

082806marketaction.jpg.dd2f40380eed086fbc68d60e8fb5cd3a.jpg

Share this post


Link to post
Share on other sites
What are the overnight session hours that you use to retreive the highs and lows?

 

The YM closes at 5pm eastern and halts to 6pm eastern. So I will take whatever low or high was made from 6pm onwards.

 

I'll usually take a look at the markets around 7:30am - 8:30am eastern and set my charts to a 24 hour chart. This pretty much shows me everything information I need. I will have my charts set to a 24 hour chart until 1-3 minutes before the open at 9:30am eastern. I will then set my charts to a gap chart.

Share this post


Link to post
Share on other sites

What about for markets that do not trade 24hours. Should I place the same level of importance?

 

If the overnight market do not trade above or below the previous days range, what does this indicate?

Share this post


Link to post
Share on other sites
What about for markets that do not trade 24hours. Should I place the same level of importance?

 

If the overnight market do not trade above or below the previous days range, what does this indicate?

 

1. If you trade stocks, premarket action is very important. Watch the overnight low and high carefully. They can act as key support and resistance.

 

2. If the overnight action remains within range there is not much change in market sentiment. This means that the market is in balance.

Share this post


Link to post
Share on other sites

This is the end result chart post for the day.

 

Notice the overnight support and value high pivot cluster became the dead low for the trading day.

 

This is the reason why I watch for overnight and premarket action to determine any key levels. This is always an edge.

083006deadlow.jpg.6b29ecaa94d71811abe2c261ef0694d5.jpg

Share this post


Link to post
Share on other sites
Could you please tell me how the value high/low is calculated?

 

Calculating the actual value area by hand can be very time consuming. I recommend paying for market profile data fees.

 

Listed below is from the CBOT Market Profile data vendor list:

 

http://cbot.com/cbot/pub/page/0,3181,1183,00.html

 

Source: Chicago Board of Trade

 

I will also post a thread on how to calculate the value area hopefully tomorrow. Will need to create it in excel format. I will keep you posted.

Share this post


Link to post
Share on other sites
On top of knowing where the previous days high and low is, it is important to watch for the globex high and low as well. These levels can act as key support and resistance point. One strategy is to go long at the globex low and short at the globex high.

 

Any break above the globex high is a long signal and any break below the globex low is a short signal.

 

One important pattern I have been seeing recently is whenever prices move below the value area during the overnight session just to have it pushed back into value. This level below the value low pivot acts as key support during the trading day.

 

I have always found that fading the overnight lows and highs is generally a decent scalp trade. Even if you're not much of a scalper, you generally want to avoid being short close to the low on the first test because you can get a very healthy bounce from there that shakes you out before you go lower. Obviously, vol being what it is right now it's a harder play to do sometimes.

 

A nice trade setup I found utilized the overnight highs and lows in conjunction with a composite or mash profile. If you open way below 3 or 5 day value, for example, and you test the overnight low and don't attract more activity, this is often a nice place to get long because moves back into value can sometimes carry all the way through it and one of those trades will make your week.

Share this post


Link to post
Share on other sites

I agree with ST and this threads title in the idea the overnight globex high and low "can be" areas of support or resistance. I attached screenshots of 12-23-08 and you can see on both the 5 min (on top) and a 1364Vol where price hits and retraces back after market open. The red vertical line is market open. Haul it!

5aa70ea3e4464_Screencapture10.thumb.png.b246b3c4392de3d847427bdfab18b9ff.png

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.


  • Topics

  • Posts

    • Date: 29th March 2024. GBPUSD Analysis: The Pound Trades Higher But For How Long? The global Stocks Markets are closed due to Easter Friday (Good Friday). The NASDAQ continued to follow the sideways trend while other indices again rose. The SNP500 reaches an all-time high, but the NASDAQ remains under pressure from Tesla, Meta and Apple. The Euro continues to trade lower against all major currencies including the US Dollar, Euro and Japanese Yen. The British Pound is the best performing currency during this morning’s Asian session. However, investors are largely fixing their attention on this afternoon’s Core PCE Price Index. GBPUSD – The Pound Trades Higher but For How Long? The GBPUSD is slightly higher than the day’s open and is primary due to the Pound’s strong performance. At the moment, the British Pound is increasing in value against all major currencies. However, the US Dollar Index is also trading 0.10% higher and for this reason there is a slight conflict here. If investors wish to avoid this conflict, the EURUSD is a better option. This is because, the Euro depreciating against the whole currency market avoiding the “tug-of-war” scenario. The GBPUSD is trading slightly lower than the 2-month’s average price and is trading at 49.10 on the RSI. For this reason, the price of the exchange is at a “neutral” level and is signalling neither a buy nor a sell. The day’s price action and future signals are possibly likely to be triggered by this afternoon’s Core PCE Price Index. Analysts expect the Core PCE Price Index to read 0.3% which is slightly lower than the previous month but will result in the annual figure remaining at 2.85%. The PCE rate is different to the inflation rate and the Fed aims for a rate between 1.5% to 2.00%. Therefore, even if the annual rate remains at 2.85%, as analysts expect, it would be too high for the Fed. If the rate increases, even if only slightly, the US Dollar can again renew bullish momentum and the stock market can come under pressure. This includes the SNP500. Investors are focused on the publication of data on the UK’s gross domestic product (GDP) for the last quarter of 2023: the quarterly figures decreased by 0.3%, and 0.2% over the past 12-months. This confirms the state of a shallow recession and the need for stimulation. The data, combined with a cooling labor market and a steady decline in inflation, increase the likelihood that the Bank of England will soon begin interest rate cuts. In the latest meeting the Bank of England representatives did not see any members vote for a hike. USA500 – The SNP500 Rises to New Highs, But Cannot Hold Onto Gains! The price of the SNP500 rises to an all-time high, before correcting 0.33% and ending the day slightly lower than the open price. Nonetheless, the index performs better than the NASDAQ which came under pressure from Tesla, Meta and Apple which hold a higher weight compared to the SNP500. For the SNP500, these 3 stocks hold a weight of 9.25%, whereas the 3 stocks make up 14.63% of the NASDAQ. The SNP500 is also supported by ExxonMobil’s gains due to higher energy prices. The market will remain closed on Friday due to Easter. However, the market will reopen on Monday for the US and investors can expect high volatility. Investors will also need to take into consideration how the PCE Price Index and the changed value of the US Dollar is likely to affect the stock market next week. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HFM Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Michalis Efthymiou Market Analyst HFMarkets Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
    • MT4 is good and will be good until their parent company keep updating the software, later mt4 users will have to switch to mt5.
    • $SOUN SoundHound AI stock at 5.91 support area , see https://stockconsultant.com/?SOUN
    • $ELEV Elevation Oncology stock bull flag breakout watch , see https://stockconsultant.com/?ELEV
    • $AVDX AvidXchange stock narrow range breakout watch above 13.32 , see https://stockconsultant.com/?AVDX
×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.