Swing trading with Market profile

We’ve talked a lot on this blog on market profile with day trade set-ups.Today let’s look at what the buyer and the seller are doing in the short term as well as the intermediate term.

Here’s a chart of the Nifty Future on a monthly time frame, rather an expiry to expiry view.

Niftymonthly Swing Trading With Market Profile

The first thing which strikes you from the chart is that value moved strongly upwards from the last expiry in June.The blue shaded regions are the value areas.

When value moves up, it indicates that buyers are in control in that TF.So monthly trend is still up.

Let’s look closely at the three points mentioned : 1,2 and 3

This control by the buyers will be given up slightly, if point 1 on the chart is lost on EOD basis. Point 1 is the POC of the last expiry at 5379 coinciding with value high of April expiry at 5364. So break of 5364-5379 alerts you if you are long.

Now point 2 is defined by the value low of last series as well as POC from April.A break below point 2 on EOD basis means that sellers have started exhibiting control.So point 2 becomes a reference line, if you want to start taking safe short positions.Point 2 is 5308-5298.

Lower down is point 3, or upper value area of the expiry in April and May.Point 3 is 5222-5190. A break of point 3 puts the market safely down for a possible 100 points and even 200 to value low.

Now let’s evaluate what we know on a smaller TF- the weekly.

Here is a weekly chart :

Niftyweekly Swing Trading With Market Profile

The chart is for the past three weeks. Value is moving up ever so slightly.5366 and 5371 are the value lows for the past two weeks.Even the weekly points to a break of 5366 as ringing alarm bells for buyers.A move above 5425-5437 will change the mode back to buying.5463 also value high will bring momentum back for the buyers.

Weekly charts and monthly charts tell you the same thing we have been knowing all along.Remember 5367 and 5466. 🙂 .

Now these points are a blue print for you, for your swing trades, but the most important information in the market is the current one. So you have to constantly weigh if the current market action is going as per your plan. Remember, the past is a place for reference, not for residence. So take action.!