The expected range-bound market on Tuesday lasted until the last hour of trading. Once the key 4340 level was taken out, sellers dominated into the closing bell.
During bearish regimes in the futures markets, traders go on gap hunts. On Tuesday the market closed the opening down-gap fairly quickly and then proceeded to thoroughly obliterate Monday’s “China” gap (Any rally due to news from China should be sold.).
The only significant remaining gap in this region is between 4209 and 4221. Mark it on your charts; I suspect that we are headed there sooner than you might think.
A Note on Volume Profile
The histogram on the left side of the chart shows the volume distribution in the S&P futures for different periods of time. Key support and resistance levels are indicated by the peaks and troughs.
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