Yesterday’s excellent price action and associated volume for the NQ Emini gave us further confirmation of the continuation of the bullish trend for US equity and risk assets in general as the index closed with a wide spread up candle on excellent volume. Price and volume are in agreement so all is well.
The foundation for the continuation of the trend was laid several days earlier in the minor reversal lower, which saw the big operators step in on high volume and followed with a repeat performance over the next two days. This price action was also supported by a further plank of the volume price analysis methodology with is support and resistance with the price testing both the volume point of control denoted with the yellow dashed line and also the red dashed line of price-based support. Following the bounce from these levels, the price based resistance of the accumulation and distribution indicator was then taken out last week and now provides yet further support below. And looking ahead, 9600 is now on the horizon and as volume falls away on the VPOC histogram this presents less volume-based resistance as we continue to climb thereby making progress easier for the index as bullish sentiment remains firmly in play and supported by the trend monitor indicator at the bottom of the chart.
By Anna Coulling
Charts from NinjaTrader and indicators from Quantum Trading
Hi Anna,
I am curious why you are saying buyers are stepping in when buying volume is dropping? Isn’t that counter-intuitive? Personally I feel that there is more selling pressure.. can the market really continue to go up so much?
I would appreciate your thoughts on this.
Thanks,
-Bryan
Hi Bryan – many thanks for getting in touch – this post was written on the 21st May and the buying was evident in that timeframe since when we have seen the markets rise – for a longer term perspective we would need to consider the weekly chart which I will do in my next analysis for risk assets and as always – regards Anna