ES review & plan

A look at the longer term picture shows us that this is the longest period the market has spent under it's 20 week sma in 2 years which is a bearish warning for the longer term trend traders. The summer doldrums have removed a lot of the volume but we may see a break of this upper range, one way or the other as volume starts to return in the next month or so.

The lack of a good high in the S&P and the giant flag pattern that's formed in the past 6 months, plus the responsive buying we've seen off the 200 day ma, increase the odds we'll see new highs. 2088.00 is the highest volume traded and longs will want to hold above this level.

On Friday, volume was very low at just 1m contracts and only 2.79bn shares on NYSE traded. The lack of longer time frame money driving prices saw a lot of the day reference levels respected by the day traders. Value was slightly overlapping higher on the day. The path of least resistance is to the upside, however, 2088 is the pivot to hold above and if this fails to hold we may see some weak longs bail out. 

Overnight we saw a false breakout to the upside and move back to the composite high volume area. The range is currently 2084.25-94.50 (settle 89.50) and another low volume day is likely as there is little due in terms of economic announcements today. 

My zones for today are:

Support                                                                     Resistance

83.75-85.75                                                                91.00-93

73.75-75.75 (also bull/bear)                                     98.25-99.75

67.25-69.25                                                                05.00-06.50                                


Hypo 1: continued upside as the market holds above the custom profile value area of past few days and takes out the 08/10 weak high.

Hypo 2: test higher and fail at overnight high and rotate through the range to find buyers at the bull/bear zone

Hypo 3: Fails to hold above 2088 and sellers attempt to take control targeting the 08/12 anomalies and references.