Review & Plan - Friday
Review
Opening within the prior day's value, we saw an early push down into the key support zone at 85.50-87.50 and responsive buyers step in. The market slowly one time framed higher for the majority of the day session on fairly low volume, eventually breaking the initial resistance and forming a second distribution above that zone to close above last week's high.
Overnight
The market balanced in a small range overlapping higher to yesterday's upper distribution and making a new marginal all time high before the release of the employment report. Following the very poor NFP number aggressive selling has pushed down towards yesterday's VPOC.
Current range 2091.25-2106.00 vs 2103.75 settlement
Plan
Given the weak economic release, sentiment has turned negative and short term bias is bearish going into the open. Primary expectation is for rallies to be sold and an attempt to fill the gap at 2077.25-80.75 on the cards, with at least a test of yesterday's low. There's potential for a strong trend day lower if there's acceptance below the initial gap. Acceptance above the overnight VPOC at 2103.50 would negate the bearish bias.
Updated zones for today:
Review & Plan - Thursday
Review
The day session opened a tick below the prior day low and attempted to break lower but failed, and once back inside the prior day range we saw adjustment of the negative inventory.
The market moved higher back through the prior day's value to settle at 2098.00 near the high. Bulls remain in control within the current range and on the longer time frame. The open gap shown below continues to hold and remains an important area for bulls to defend for continuation, though the more attempts into the 83-6 area will weaken the defense.
Above the last two day's highs are weak and show no excess. The balance area shown within the square below is building volume for a directional move but range trading is still expected until we see strong momentum and volume breaking balance.
The attempted breakdown after the open was not supported by market internals - TICK mainly positive, A/D trending higher from low levels and lack of aggressive selling in the cumulative delta.
Overnight
Narrow range - 91.25-98.25 vs 98 settlement, and low volume. ECB rate announcement and OPEC meeting key events.
Plan
Zones for today are below. Main expectation is for market to continue to trade around the current range value area. If we see acceptance above or below the 85.50-87.50 or 97.25-99.25 zones on strong volume and momentum I'm looking for a directional move to go with.
Review & Plan - Wednesday
The day session chart above shows the breakaway, unfilled gaps left from the recent rally. For longs to maintain control short term, the upper distribution would need to hold or risk a potential liquidation break to fill in the gaps below.
Yesterday failed to reach the all time high and saw some liquidation back towards the most traded price of this upper range at 2087.50
The longer term bias is still bullish and the short term is neutral following yesterday's failure to take out the all time high.
Zones for today are below. Whether the market holds the 85.50-87.50 zone will be key for directional bias today in my opinion.
Review & Plan - Friday
We saw a trend down morning with longs failing to hold support at the 64-65.50 initial support zone. This would have been a sign of strength from longs and given more bias to a breakout higher through 73.
From yesterday's note:
Acceptance below 64 puts chances of continuation lower to 53-54.75 or 46-49 intermediate bull/bear.
There was a strong initial reaction from the 46-9 zone as the market had got very short intraday and pressure was on to cover once back inside the prior day's range.
Overnight has tested the bottom of the 46-9 zone. We've seen bearish daily price action within a composite high volume area. Trade continues to move from one side of this area to the other so it's important to be flexible with any short term biases.
Zones for Today:
Economic data due here.
Overnight bull/bear 57.50-59.50 - acceptance above and looking for rally to 71.50-73 zone potentially, acceptance below and retest of overnight lows and if intermediate bull/bear breaks, a move to 40.50 or lower
Review & Plan - Thursday
The 4hr chart above shows the very concentrated volume area created over the past 5 years, which you can see it has tested the low volume edges of each side in the past week.
Yesterday was a frustrating one for longs given the prior day trend day as the market failed to push through the overnight high and trended lower to finish on the low below the prior day, also closing the gap. Crude was strong yesterday but even that failed to lend support, though bonds were strong along with a sharply weakening dollar index.
The high was made in the initial 77.25-78.75 overnight resistance zone and low in the 57.50-59.75 daily breakout support zone.
Overnight the market has managed to hold the low from yesterday and found responsive buying back up to the 71.00 prior VPOC. The range is currently 2057.50-71.50. The move lower yesterday would have shaken out weak longs and also trapped late shorts.
Plan for today:
The overnight rally is building value above the lower volume distribution from yesterday afternoon, between 60-64.50, though volume is fairly light. If that area holds then would look for reversal of yesterday's action and potential break of Tuesday's high and extreme upside target at the 91.50-93 zone, though expected move is to 84-86.25 zone.
Watching for what reaction we see at the 71.50-73.00 overnight resistance zone
Acceptance below 64 puts chances of continuation lower to 53-54.75 or 46-49 intermediate bull/bear.
Crude is rallying but unlike yesterday, bonds are selling off and the dollar rallying.
Review & Plan - Tuesday
Full Session
Yesterday's day session balanced within and above the upper distribution from Friday, accepting higher prices and settling above the prior day high.
Overnight tested yesterday's low first and responsive buyers pushed up through recent highs up to the 2068.75-70.25 resistance zone. The globex range is currently 2048.00-69.25 and the weekly profiles on the 60 min chart with the prior day's zones below show the sharp pullback to the top of this week's value area high:
Today's Plan:
The market has broken out of it's short term down trend and it's next intermediate target on the upside is last week's high at 2077.50. Holding below 2046.00 puts shorts back in control.
The overnight bull/bear zone is 2057.50-59.75 which I would expect to hold if buyers are strong. Below there the current 2030.50-77.50 range and weekly VPOC is at 2053.00 and the day time frame bull/bear zone remains at 2046.00-49. How the market responds at these zones is important and I would not expect the market to fall through the 2052.75-54.75 zone if there is going to be upside continuation today.
Above the overnight bull/bear zone are the potential resistance zones to rotate from. Holding above the overnight high puts the 2077.50 on target followed by the 2081.25-83.50 zone. Failure to take out the overnight high is likely to see more balanced trade which I would expect between 2053-68.
Review & Plan - Monday
Last week's sell off found responsive buyers on Friday at the bottom of value for the above range and low volume area on the composite profile. The market still remains below the composite VPOC and the last key swing high at 2077.50 so until it's above there sellers are likely to defend strongly against the short term reversal higher.
On the weekly profiles below we can see that until there's a break and hold above the 2060 area there's still resistance short term.
Friday's RTH profile shows the two distributions formed after the reversal from the lows. Holding the upper distribution or not will be key to short term bias for today.
Overnight moved higher to test the 2059.25-60.75 resistance zone having broken out of the downward channel shown below on Friday.
The bull/bear zone for today is 2046.00-49.00 with overnight support at 2052.75-54.75. If buyers can hold this zonethere's a good chance of extending the overnight range higher into the 2063.25-64.75 zone and potential target zones above there.
Acceptance below overnight support could see a test of the bull/bear zone and acceptance below there could see a test of the breakout zone from Friday at 2040.00-42.75, which would also test the outside of the channel breakout. Sellers would be in strong control beneath this zone and a move towards Friday's lows would then be next expectation.
Review & Plan - Wednesday
Yesterday had low volume at just 1.2m contracts. The market did manage to hold above the prior day's value area, despite sellers pressing several times to no avail.
FOMC later today could see a break from the short term balance area it's been stuck in for the past week, since pulling back from the new high. Primary expectation is a break to new highs if the market can hold above 2091.50. We may just rotate around the range VPOC this morning but a lot will be dependent on how AAPL trades, so watching NQ closely.