ES review & plan

Buyers were firmly in the driving seat yesterday after opening above Wednesday's high and failing to fill the gap. It was a slow and grinding move up on modest volume of 1.4m contracts and 3.8bn shares on NYSE. Internals were strong with the advances-declines between 1500-1700 all day and the tick staying above zero for the majority of the time. Any new shorts added fuel to the grind higher. Settle at 2084.00 was also the VPOC on the day.

Overnight the market has continued higher and taken out the all time high with buyers still firmly in control. There's no major economic data scheduled and a long weekend ahead for the US. The market is one-timeframing higher on the daily basis.

My expected scenarios for today's RTH session are:

1. We see a small test lower into yesterday's range and then rally through the all time highs and then see liquidation into the close ahead of the long weekend. The open gap and naked POC/VPOC below as potential targets.

2. We test lower and drive to new highs and hold above the 2088.75 level shifting value higher and accepting the breakout.

3. The least likely I think today is that the all time high doesn't get taken out in the RTH session and a liquidation break fills the gap and tests the naked VPOC/POC.

2084.00 will be an important level to hold for buyers today. The shallow afternoon pullback low yesterday was 2081.75, which was tested at the globex open overnight. If the overnight low at 2081.50 breaks then we may get a break and opportunity to buy at the 1975.25 LVN:

Acceptance of the breakout puts the long term target back in the sights, being 2156.00 - the 161.8% extended retracement of the Oct '07 high to Mar '09 low.