Monday Prep

The strong kickoff to the Q1 earnings season in the financials pre-market on Friday gave ES the strength to fly through 2900, after many failed attempts this month. The gap wasn’t closed intraday but instead pulled back from one of the measured target zones into the overnight pullback area following the initial pop higher. Another strong close left settle at 2912.50, at the top of the day’s value area.

Overnight so far the range is 2909.25-14.50, the smallest we’ve seen for some time. If the 2907.50-09.25 zone can hold when tested, the main expectation would be for attempted continuation. If that zone breaks and becomes resistance then we could be setting up for a gap fill attempt and balancing. A complete reversal would be the least likely unless we get some strongly negative headlines on the ‘ we’re nearly there on signing’ trade deal, for example. GS have reported pre-market and trading down a few points ahead of the open.

Zones of interest for today below. The 2900 level is an obvious one of course and relevant to option open interest. If prices start to accept inside 2900 it’s likely sentiment has turned and potentially rejected the breakout.