Daily Brief - Friday, 5/16/25
“In-Balance and On Edge — NQ Opens Quiet After OI Drop, Awaiting a Catalyst”
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News Docket
Friday - 5/16/25
8:30am EST - US Housing Starts (Expected: 1.365M)
10:00am EST - University Michigan Sentiment Prelim (Expected: 53.3)
Prior Session Stats & Analysis - Thursday, 5/15/25
Session Stats
Open: 21,302.50
High: 21,529.75
Low: 21,247.75
Close: 21,412.00
Settlement: 21,400.25
Range: 282 pts (1128 ticks)
Volume (Est.): 543,381
Open Interest (Prelim, NQM5): -3,647
Value Area (Market Profile)
Value Area High (VAH): 21,450.00
Point of Control (POC): 21,425.00
Value Area Low (VAL): 21,300.75
Market Profile View – 30-Min Chart
Thursday was a Normal Variation Day Up, with a range extension to the upside that ultimately failed.
Price rejected strongly from the 21,520 area, falling back into value and closing within the prior day’s range, near the previous high.
The value area expanded on both sides of the prior session’s — the VAL moved lower, the VAH moved higher, and POC rotated up slightly.
This indicates fair value nudged higher, but there was no clean directional shift in value.
Notably:
The day’s range engulfed the prior session’s entirely, printing both a lower low and a higher high
No excess or single-print tails were present for the second session in a row
Open interest dropped (-3,647) — the first session of lost business since May 9
The profile structure made value development difficult to read intraday, as there wasn’t a clean migration — just expansion. Reading developing value and aligning with higher timeframe value tough.
5-Minute Chart Breakdown – NY Session
We opened in-balance, but near the bottom of the prior session’s range.
The open was characterized by chop and indecision, with two attempts to break below the previous low — both of which were firmly rejected by buyers.
After the second rejection, sellers backed off, and buyers took control:
Price rallied ~273 points over three hours
This move broke out of the prior range, with a new daily high around 21,525
Best momentum trade of the session if you caught it
The up-move ran out of steam near 21,520, forming a weak high, and sellers re-entered, auctioning price back into — and eventually below — the value area.
At one point, it looked like we might retest the prior low, but buyers stepped in ~40 points above that level and held into the close.
It was a session that gave a trade window on that momentum move up, but not without some noise on either side of it.
Volume & Participation
Open Interest: -3,647 — first negative OI print in six sessions
Volume: ~543k — higher than Wednesday’s, though not explosive
Range: 282 points — double Wednesday’s range, but still modest in historical context
Final Thoughts
Thursday gave us a clean momentum sequence — but value development was messy. We saw a full range expansion, strong intraday reversals, and the first sign of position reduction after nearly a week of steady long-side growth.
This could be late-stage trend behavior — or just a breather before continuation. Either way, the lack of excess, the POC sticking near highs, and the pullback from 21,520 are signals to watch.
Pre-Market Plan – Friday, 5/16/25
Market Context
As of this writing, overnight inventory is slightly long, trading ~75 points above yesterday’s settlement. Price is currently above yesterday’s value area but still within the full range — we’re set for an in-balance open.
Key economic events today:
8:30am ET: US Housing Starts — may bring early volatility
10:00am ET: University of Michigan Sentiment — often a market mover
I plan to be flat heading into the 10am release.
What stood out yesterday was the decent loss of open interest, the first in over a week.
Was it profit-taking during the late-day pullback?
Or just old business clearing to make room for new buyers?
We can’t know for sure — but it’s something to watch heading into today’s OPEX and next week. OPEX may bring volatility today.
Elsewhere, headline risk remains elevated:
Ongoing developments in the Middle East
Ukraine–Russia peace talks
Renewed recession chatter, with Steve Cohen pegging odds at 45% and Jamie Dimon refusing to rule it out
None of these may affect today’s session — but if any do, they’ll move the tape quickly. Stay alert.
Bias & Mindset
Bias: Neutral
Every time I’ve leaned bearish this week, the market has proven me wrong. So today, I’m staying truly neutral — clear-headed and reactive.
That doesn’t mean I’ll ignore short setups. And it hasn’t stopped me from taking longs when the tape supports them.
The goal is to trade what’s in front of me, not what I think should happen.
If we open in-balance, I’ll remain patient. Avoiding early chop will be key — especially after yesterday’s roller coaster session.
Key Levels I’m Watching Today
Upside:
21,525 — Yesterday’s weak high; may be retested soon
Downside:
21,360 — Overnight low and key intraday S/R from Thursday
21,295 — Strong support zone over the past three sessions; could now act as resistance
21,250 — Multi-session support; dipped briefly overnight and recovered
21,000 → 20,960 — Former resistance zone; potential support if tested again
Final Note on Today
We’re closing out the week with an in-balance open, fresh economic data, and a market that’s held up despite skepticism.
Stay patient. Stay responsive. Let the market make the first move — not your bias.
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