ES Update

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Today is the last trading day of 2012.  We will get a Globex trading halt at 5:15 pm (New York) in observance of the New Year holiday, and trading will resume at 6 am (New York) on Wednesday, January 2, 2013

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Let’s do a quick rundown of the time frame setups for today…

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On the monthly bars, December is showing a higher high/higher low configuration with a bar range of 1382.25 to 1446.

The candle body is dark < 1407

It would take a move under 1334 to break the previous monthly low.

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On the weekly bars…

Last week’s bar range was 1382.25 to 1425.50 with a close at 1384.

Under 1382.25 is bearish

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On daily bars…

The move under 1391.25 was the stop sweep target from the counter-trend sell near 1446.  So long as ES trades above that line, it is a stop sweep/reversal play.

The bull/bear line here is also the previous bar low at 1382.25

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Moving in to hourly bars…

We can see the stop sweeps under 1391.25 and also under the Stops and Targets’ short-term primary trend line at 1386.75.  The ideal entry zone for the pullback to last short-term support is between 1386.75 and 1401.50

The VST bull/bear line is shown at 1382.25 and bulls are fine above–but if that line were to be broken to the downside the next targets lower are stops under 1376.75 and then IT primary trend line support down near the 1360 area.

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Stops and Targets says short-term time frame is in play with the primary trend line at 1386.75, so we have agreement and can fine tune that downside bull/bear line to 1382.25 to use as a hard deck for all trending trades.

So, bottom line for today (literally) is 1382.25.  Bulls are in charge above that line, but sellers in multiple time frames would likely appear below.

Happy New Year!

…my .02

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ES Update

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With three trading days left in 2012, let’s get our key bearings starting from the higher time frames and working inward…

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At this point, the December monthly bar is showing a bullish higher low and higher high with a bar range between 1390.50 to 1446

VLT trendline resistance has been previously broken –and trend line support remains intact > 1242

The very long-term range is 1036.75 to 1519.50 and there could be major trend/momentum consequences when one side or the other of that range is eventually breached.

ES is much closer to the top than the bottom of the range and the pros have come a long way since that 583.25 low back in March of 2009.  Monthly bars aren’t real sexy to most short-term traders–but this is the setup that the big boys are playing, and so it makes imminent sense to keep this big picture in mind as the hysteria of ‘fiscal cliff’ is being promulgated by the press.  A bit of unsolicited advice for traders is to simply IGNORE the media.  Their job is to stun, confuse, and to drive the herd toward the ambush areas–and they are pretty good at it.

The chart above shows a clear pattern of directional intent since the start of the current US administration’s first term.  The objective at 1519.50, if eventually overcome, would completely invalidate the secular bear market since March of 2000 and reawaken the investing masses after a nearly 1,000 point run from wholesale to retail pricing!  They are currently only about 100 points away..but as I have said before, these VLT moves can take a long time to play out.

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Moving in to the weekly bars, we can see that the current holiday week has been trapped in about a 15 point range between 1410.75 to 1425.50 thus far.  The real range to watch is the previous week’s hi/low–which is 1391.25 and 1446 (current VST range).

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On the daily bar chart above we can see the VST range between 1391.25 and 1446.

There are two open gaps at 1426 and below at 1353.50.  Generally speaking, ES doesn’t like unfilled gaps except for those created at the start of a reversal in the direction of the pro’s trade.  The gap at ES 1353.50 was established at the bottom spotter low confirmation from 1334.

The previous bar’s low at 1410.75 establishes the current bull/bear line for VST traders.  The pros have already raided the stops down to 1391.25, so there is probably no reason to revisit that area below–unless the intent is to extend the low under 1391.25.  So, that is a line to keep in mind.

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And finally, we move to the hourly bars…

The small range has been between the gap fill at 1410.50 and the opening gap at 1428.50.

The dominant feature on the chart currently is the 50 point late night take down on 12/20.  As I mentioned before, that cleverly established a minimum structural pivot in the futures, while simultaneously shutting out the massive selling that would have occurred had the event occurred during cash market hours.  That low at 1391.25 was deviously sneaky, to be sure–and we’ll see how it holds up in the coming days as we watch the year end maneuvering play out.

…my .02

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Addendum @ 10:30 am (New York)…

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The Stops and Targets screenshot above shows the short-term counter-trend setup from 1417.75.  The initial target from that signal is the ideal entry zone between 1400 and 1404.50 (shown as shaded area on hourly chart above), which has now been achieved.  It will be interesting to see if a bounce can stick here near the 1400 level–or if we head to the next target lower, which would be the 12/20 low at 1391.25.  If they take out that low it would restart the cycle clock for finding the next structural pivot–so 1391.25 is a key VST/ST number.

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ES Update

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So much for the ‘end of the world’, as the Mayas’ 14th Baktun begins…

The pros never miss an opportunity to exploit this sort of silliness, though, and overnight we got the minimal ST structural pullback I have been looking for on a quick swoop down to 1391.25.  As I pointed out yesterday, they needed to get under the 1405 area, and they did.

The VST resistance at the top of the filled void at 1445.25 was indeed a good counter-trend entry–but bearish traders had to be very nimble to pick up the move under the stops at 1405 in the overnight hours.  So, for the pros, mission accomplished to set up a potential structural pivot–while simultaneously shutting out the sellers that would have otherwise appeared during cash market hours.  Pretty slick.

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ES 1417.75 is the ST line in play, with the ideal entry zone being between that line and 1426 looking for the next upside target at 1450.75.  If we were to get a hard break under 1417.75, that would bring the overnight low at 1391.25 back into play.

All trends remain up > 1386.75

Happy ‘New Baktun’  🙂

…my .02

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ES Update

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ES has now climbed > 8% since the confirmed bottom spotter low on November 16 at 1334 for a little over 112 points of rally to this morning’s local high at 1446

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The pros again broke the VST channel and have tagged resistance at the top of the now filled void at 1445.25.  That is the line in play this morning as we continue to watch for a potential ST pullback in the first leg of a powerful move that has climbed with only shallow pullbacks since 1334.

Eventually, we are going to get a pullback to set the next ST structural low.  It would require a move under 1405 from the present configuration to set a minimal higher low.

The real prize for this move up from 1334 are the bear stops resting just above 1461.75, but we’ll have to wait and see how much juice this push has before the inevitable pullback.  I have been pointing out the counter-trend bearish setups along the way (including resistance here at 1445.25), but all trends remain up greater than 1386.75 and ES is trending VST > 1432.75 and ST > 1417.50

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We currently have a pause here at the 1445.25 VST resistance target, with Stops and Targets looking for the next higher ST target at 1450.75 and the ideal entry zone at 1425.50 to 1431.75 for a pullback

…my .02

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ES Update

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ES has climbed more than 7% since the confirmed bottom spotter on November 16th at 1334 (adjusted for continuous contract pricing).  The short-term continues to trend bullish > 1417.75 and all primary trends are up > 1386.75

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We got the shallow pullback and tagged the lower target of 1407 that I was looking for in my last post.  The pros broke the old VST channel bottom and then immediately reversed, with an actual low of 1405.75 set on the move.  That low became the bottom of a new VST (very short-term) range to 1432.50–which was slightly exceeded this morning on another potential counter-trend stop sweep/reversal setup (this time VST) at that line.

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On the hourly bar chart above I have drawn in a shaded ideal entry zone from Stops and Targets between 1417.75 and 1426 (shown on ST tab above).  I have also drawn in a new VST trend channel using the new VST range of 1405.75 to 1432.50.  Early on, that line at 1432.50 is in play–and like 1425.50, we watch to see if sellers appear below–or if the squeeze continues toward the top of the channel and into the void above.  The top of the rising trend channel is currently at the 1440 area, and next VST resistance above is at 1445

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The range chart above shows the current trending breakout and the two stop sweep/reversal candidates; ST at 1425.50 and VST at 1432.50

Note also the narrowing of the IT range, with the bottom spotter low at 1334 now morphing into an intermediate strength move.

Let’s watch 1432.50 here to see if we get exhaustion–otherwise, the squeeze continues > 1405.75, which is the line bears would need to take out to start flipping momentum.

…my .02

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