The Nifty future hit the objective given by the profile in the previous post – http://vtrender.com/content/nf-july-quick-profile-check and a round of profit booking was obvious immediately.
Here is the updated chart showing the composite structure :
When you trade through profile it is important to see the market behavior as continuation or change and we are again at one such point this morning.
Yesterday we had an auction complete which was evident in the structure of the gaussian curve which showed up at close. Auctions begin or end in single prints or such curves.
Looking at the profile above once again we see 5785- 5770 as an important level for the day and a break of that can start a move to 5720 to fill up a poorly traded volume zone between 5700 and 5900 on our charts.
Back to today's session and it is important to see how short the market was in yesterday's session.
The session itself was slow and random and in itself it tells the trader than there is activity brewing below the surface.
In such cases it helps to look at a one minute OrderFlow chart of the activity per minute traded which gives an idea of the limit orders placed and executed. This chart is courtesy Viren ( @VirenRasquinia) .
This is a chart of orders ( limit and market) placed yesterday.
The chart is the same as your Bid ask window of the trading terminal which gives you the price and quantities, but here you get to see a larger view than the numbers we see on screen.
Clearly the Buy pane lacked buyer conviction all day yesteday as buy orders were mostly absent.
The flow was definitely dominated by sellers and we also had the day's largest seller show up near 5872 yesterday. That should explain the gap down as there were a sizeable number of shorts created per the chart..
Stay with levels , not your bias and watch the OrderFlow!.