ES review & plan
Yesterday saw new highs again (2043.75) during the Asian session and a correction of long inventory prior to the jobless claims announcement. The pit session opened at the top of the prior day's range and drove higher towards the overnight high but lost momentum 2 ticks short and weak longs liquidated drawing in shorts to target the overnight low and prior day's low. It closed close to the middle of the high volume balance area created this week. Confidence is low. Volume was a modest 1.5m contracts and 3.47bn shares on NYSE.
Retail sales are due at 07:30 cst with consensus expectations for a 0.2% rise.
The 3 most likely scenarios I see playing out today are either:
1. The high volume balance area between 2030.50-2037.50 acts as support before an attempt to move higher and make new pit session highs and a Friday afternoon inventory correction back into balance.
2. We remain within balance and rotate back and forth before a break lower targeting last Friday's low at 2020.50
3. Prices open at the lower end of balance and drive lower through 2020.50 towards the next high volume nodes at 2015.50 and 2010.00
Although we continue to see day after day new highs, confidence remains low this week particularly, and volume is unexciting. Seasonal factors are on the market's side but I think it's a case of enjoy the party but dance by the door!