How is it that the market falls in the last two hours of yesterday's trading from 1532 to 1525 on volume of about 300,000 contracts.. In the overnight session, the market retraces the entire move on 88,000 contracts... What is the Emini following? Am I missing something? Is this just ludacris? The all-powerful dip-buying machine can move the market higher on 1/3rd the volume??
It's generally easier to move the market overnight since there is less liquidity. With the benefit of hindsight yesterday's sell off appears to have been a short term (intraday) bear trap.
The lighter volume can also be short-cover buying instead of new-position buying. The market can still be "vulnerable" to late afternoon sell-offs if that's the case. We'll see.
a fair portion of the overnight action is due to foreign action remember that foreigners can buy US stocks via ADR's etc and this will also help move the market accordingly and remember, the ES is a vehicle for both hedging AND speculation
The price moves according to the DOM ladder. Greater volume guarantees nothing unless it is asymmetrical. Just look at an inside day, or better still, a day where volume is well above average and the close of the RTH winds up near the open. There is a lot more to this game than at first meets the eye.
Still, watch out for a correction today / tomorrow back to 10 day MA at 1517. Action today is sort of short-squeezing. OEX CPR is at 3,85. Does mean : smart money is not buying at these levels.