Wednesday Prep
The daily chart above shows the volume at price since the start of the year (left profile)and we can see price has made a bullish recovery over the past few sessions and is looking like it wants to breakout to the upside. This is going to need volume and momentum, together with broad market strength or else this could lead to a false move. If this does turn out to be a false move then the weak structure left from last Friday could be revisited sooner rather than later. If, however, the rally does have legs then the next major upswing swing high is at 2718.50 (a poor high left in the 4/17 overnight session). Although I don't use trend lines per se in my analysis, I need to be aware that many do and the upper trendline on the daily is also shown (around the 2704 level today).
Yesterday's profile balanced overlapping below Monday, though still supportive of Friday's bullish move. Trading got choppy in the afternoon with headlines about Iran, sometimes false, took crude on a rollercoaster ride.
Overnight so far, the range is 2666.50-84.50 versus settlement at 2670.25.
PPI-FD is due at 07:30 ET and a 10 Year Note auction at 12:00 ET. Zones of interest for today are shown below. Short term bullish bias if the 68.25-70.75 zone holds or it could turn neutral again. Holding above the 81-82.25 micro bull/bear could see a squeeze higher.
Tuesday Prep
We did get a move higher into the 81.00-83.75 zone yesterday after opening just above the prior high. There was a lack of upward momentum and volume to support the rally, which eventually fell back to close the settlement gap.
Overnight so far has drifted lower to test the 57.00-58.75 zone, with the range currently 2658.50-72.25. We have extra geopolitical risk with Trump's update on the Iran deal - WTI crude is currently down about $1 at $69.80 with record long positioning in the contract.
If the market can hold above the 57.00-58.50 support zone we could see an attempt to retest yesterday's high, though I'd expect the 69.50-72.50 zone to be the first major hurdle for buyers. If we see 57.00 break and hold below, a move lower into the next two zones is possible depending on weakness. 2647.00 is the month's VPOC so would be looking for a reaction there.
Zones of interest for today are below:
Monday Prep
Friday's open dipped down into the 2610.25-13.00 zone briefly, which represented the prior day mid and breakout point. Rejection of this zone was a clue buyers could once again dominate, though the driving rally showed signs of a short squeeze with single prints left in it's wake. Once above the prior day's high, the risk to short the market massively increased as positioning got squeezed higher.
It's a bank holiday here today with some well needed sunshine and heat, so will be leaving the screens. However, for those trading the market overnight has pushed above Friday's high, with a range currently of 2661.25-74.00 on very light volume and drifting higher.
The daily chart below has a custom volume profile from the all time high to date, showing the VPOC still at 2657.50 (a natural magnet on Friday if prices were rejecting lower moves, though much faster than I anticipated!)
New zones of interest for today are below. I would expect a positive first response off the initial support zone, but if that fails the monthly VPOC at 47.00 is next logical move. On the upside I can see sellers stepping in at the 81.00-83.75 zone, but a break through there could see a further squeeze into the 92.25-95.00 zone. For a sustained move higher, volume, momentum and market breadth are needed.
Friday Prep
Once again opening below the prior day's range, the market initial pushed down towards the prior week's low and then made a failed rally back to the open where sellers stepped in heavily leading to a fairly quick move to test the 2589-91.75 composite high volume area. Shorts got trapped as you can see in the 1 min chart above, where cumulative delta was still pressing the lows even though prices had made higher lows. This can be a bearish signal of more continuation to come but it also highlights the vulnerability of shorts to a squeeze on news etc. (see H period in top chart).
Overnight the range is currently 2616.75-34.25, post the employment report. We might consolidate in the mid of yesterday's range, which is difficult for good R:R trade location.
Zones of interest for today are below:
Thursday Prep
We got a decent range again yesterday with the main action after the FOMC minutes, which was to be expected.
I've shown on yesterday's zones above the key reasons for the zone placement, though this is always done in context and is subjective.
The failure on the rally to break above the late pullback high from Monday put sellers back in the driving seat as longs bailed out to push down towards Tuesday's low.
Overnight so far the market has remained weak with the range currently 2617.00-36.25, selling off strongly in the past hour or so. If we see the sell-off continue after the open, the next key reference is last week's low at 2611.25. If it fails to accept below that I would be looking for shorts to cover and see a rally back up to the 2633-34 high volume area as one scenario I can see playing out potentially with the hotly anticipated employment report tomorrow. Holding below last week's low is a warning bell for longs or potential longs.
Today's zones of interest are below:
Wednesday Prep
Yesterday opened outside of the prior day's range and continued it's negative pressure during the morning before a sharp turnaround at midday saw aggressive short covering, a gap fill and change of intra-day trend to bullish for the remainder of the session.
Overnight the range is 2643.25-58.50, with the initial bullish move after hours with AAPL losing steam. You can see from the daily chart above that the current VPOC since the all time high to now stands at 2657.50, and we have an FOMC announcement later. I've marked zones of interest for today on the RTH profiles below:
Yesterday opened outside of the prior day's range
Tuesday Prep
The market correction is now coming up to 3 months old, and prices remain about 8% off the all time high. On the above daily chart I've drawn a volume profile around the range extremes up to date which shows a fairly balanced distribution with prices currently rotating around the VPOC of that range at 2657.50. Earnings season so far has delivered mainly stronger than expected EPS and revenues, but we're not seeing much follow through in price. AAPL is the big one after hours today - given how weak forward guidance has been by Taiwan Semiconductors, this is going to be an interesting one to hear from Apple.
The overnight range is currently 2641.25-53.75, overlapping lower to yesterday. The double distribution yesterday is separated by the single prints highlighted and there was a poor low left. The top of the low distribution is at 65.25 and I would remain short term bearish unless this is broken and held above.
Wednesday Prep
The market had spiked higher pre-market following CPI data that was in line with estimates. There was an attempt to push through the overnight highs after the open but as you can see in the 1 min chart above, the TICK was not showing strong bullish readings with the move and we eventually saw a precipitous move lower. The retest of the overnight low at 2788.00 (also within the bull/bear zone I was using) was probably the best R:R opportunity for a short following the impulsive move lower. The weak structure from last Friday was revisited and 'repaired'. However, there's still a large open gap which is why I was reluctant to put a green zone ahead of it.
I'm travelling today so won't be able to trade but have updated the zones below. The 86-89.50 area still looks key for sellers to defend and a move and hold above there could put the squeeze on the shorts once again. Retail sales and PPI are due at 07:30 ET.
Tuesday Prep
Yesterday the market gapped above the prior day's high, took out the Feb 27th RTH high at 2795.75, but failed to get the volume and momentum to continue, leading to pullback. A balanced profile was left overlapping higher to Friday's range.
The 2788.50-89.50 area has built noticeable volume and I'm using that as a short term bull/bear zone because acceptance below that could see sellers drive lower to take out yesterday's poor low and weak structure left from Friday's move. Above there puts buyers in a stronger position to push higher, though there are some potentially strong areas of resistance above.
Overnight so far, the range is 2786.25-2804.25, following CPI data that was in line with expectations. The key zones I'm watching today are shown below - overnight support at 94-96 and short term bull/bear at 86-89.50 being the nearest to the market currently. The current trend remains bullish but be aware the recent moves have left weak structure below to be revisited should we see a break.
Monday Prep
Friday's strong jobs report combined with subdued wage growth sparked a strong, straight up rally all day leaving a lot of weak structure in its wake. Any positioning ahead of the release for a sell-off was aggressively squeezed out and forced to cover.
This rally has continued overnight breaking above the last swing high on Feb 27th and is currently moving up towards the major breakdown area (see circle below) from Feb 2nd, which is nested below January's VPOC and the Feb high. This is a key area where I would expect sellers to step in on first test. A break and hold above the 2843.25 Feb high changes the medium term outlook to bullish from neutral. With more supply in the 10 and 30yr auctions plus CPI, Retail Sales and PPI in the first half of this week, there are some potential headwinds..
The overnight range is currently 2788.00-2805.25 vs 2788.75 settlement (ESM8). Acceptance back inside Friday's range could see some late longs liquidate and push down into the single print areas pointed out on the above chart. Consolidation of the move is more likely in the absence of any market moving news.