ES Update

.

Screen Shot 2013-06-28 at 9.53.58 AM

.

Not much has changed since my last post.  ES has been working higher off a 3 day bounce from the IT buy target I pointed out near at 1553.25

Yesterday’s bar shadow is 1594.75 to 1614.50.  So far, we have another higher low/higher high working–but a pullback is threatening the lower boundary.  The bounce momentum would change with a breakout under 1594.75

Next target higher is the open gap at 1623.75

Next support lower is a rising minor support trendline that lines up roughly with the ST primary trend line at the 1590.50 area.

ES 1590.50 remains the bull/bear line as we await the possible formation of a new ST structural low at 1553.25.

The cluster of trailing stop resistance lies between about 1623 to 1640 area.  That is what counter-trend bears looking for new lows are using as backstops on IT trade setups…

.

Screen Shot 2013-06-28 at 9.57.20 AM

.

The counter-trend bearish setup is a little clearer on the daily range bar chart above.  A breakout move under yesterday’s bar low at 1594.75 would likely bring out sellers and the ST primary trend line is just below at 1590.50

The VST range is between 1553.25 and 1649–and price is currently at about the midpoint of that range.

…my .02

.

.

ES Update

.

Screen Shot 2013-06-26 at 9.59.34 AM

.

Yesterday I pointed out the IT buy at 1553.25 juxtaposed against the ST sell under 1590.50

This morning in the early trading we are seeing that push meet the first IT resistance target, which is a back-kiss of the extended IT support trendline that was broken on 6/20

The ST trend has flipped back to bullish > 1590.50–but would reverse back to bearish if this push from 1553.25 fails.

Early NYSE internals are very strong, running about 5:1 bullish–so bulls have some firepower working to get back to the broken IT trendline back-kiss test at 1596

Next VST upside target will be 1626.75.  Next lower target, if momentum is rejected at the trendline is 1553.25

.

.

Screen Shot 2013-06-26 at 10.17.45 AM

.

As I pointed out yesterday–what we are seeing here is a struggle between the IT bulls (above 1524.75) and ST bears (beneath the dashed trendline resistance on the chart above) to determine which side takes control of the momentum.

We have seen before how the pros sometimes use breakaway gaps to set future ranges.  On a daily bar perspective–the open gap at 1623.75 is the next upside target.  The next open gap target lower is at 1528…so we’ll keep those two numbers in mind as this current pattern develops.

…my .02

.

.

ES Update

.

Screen Shot 2013-06-25 at 9.00.45 AM

.

The channel bottom bounce target at 1558 I pointed out yesterday held up on the hourly bar closes–but the pros overshot slightly to 1553.25 to break that channel before reversing.

I have drawn in yesterday’s bar shadow range between 1553.25 and 1586.25 as a dark blue rectangle on the hourly chart above.  It would take a move outside of that range to begin trending in either direction.  A move above 1586.25 would set a higher high and higher low on the daily bar and force covering by bears.  A breakdown below 1553.25 would run the stops under yesterday’s IT buy signal.

.

Screen Shot 2013-06-25 at 9.24.12 AM

.

Screen Shot 2013-06-25 at 9.24.24 AM

.

The bounce at 1553.25 came from within the IT ideal entry zone (an IT buy) and has now moved up into the ideal entry zone (ST sell) for the ST time frame.  So, ES is currently ‘stuck between a rock and a hard place’ as we watch to see which time frame wins the momentum battle.  Generally speaking, the higher time frame signal trumps the lower–but we’ll see how this goes.

ST trend is bearish < 1590.50
IT trend is bullish > 1528

…my .02

.

.

ES Update

.

Screen Shot 2013-06-24 at 9.35.23 AM

.

Friday’s ES price action created a weekly bearish engulfing candle, broke the IT support trendline on a close, and is extending the top spotter signal from 1679.75

.

Screen Shot 2013-06-24 at 9.34.22 AM

.

With a break below 1570, we are seeing a lower low on a monthly candlestick for the first time since November of 2012.

.

 

Screen Shot 2013-06-24 at 9.41.32 AM

.

The daily bar range chart above shows the break of ST and IT trendline support and the bearish range breakout under 1590.50.  That line continues to serve as the bull/bear line as we watch to see what happens under 1570

.

Screen Shot 2013-06-24 at 9.44.50 AM

.

The hourly bar chart above shows the current VST configuration with stops being run under 1570.  Next targets below are the IT ideal entry zone between 1528 and 1561 and the bottom of the VST bearish trident channel.

.

Screen Shot 2013-06-24 at 9.49.26 AM

.

Next S&T targets lower for the IT and ST are at 1528 area, and that lines up with the VST target cluster in the same general neighborhood.

First order of business, though, is the bottom of the descending VST trident channel, currently at about 1558

Macro trend has changed to Bear 1 under 1590.50 and that is the bull/bear line as the intermediate time frame supports come into play.

…my .02

.

..

ES Update

Screen Shot 2013-06-21 at 9.36.06 AM

Note the recent touch of the channel top and the pullback to IT support on the weekly candlestick chart above.

.

Screen Shot 2013-06-21 at 9.37.00 AM

Same weekly chart zoomed in to show the current outside candle.  (The shaded yellow rectangle shows the previous range from the prior week)

.

I  wondered what sort of trap the pros might set around the FOMC and quadruple witching week.  Looks like the plan all along was to run the stops on both sides of the weekly range between the two numbers I have been emphasizing in recent days; 1642.50 and 1590.50

That trap-springing action has created an outside bar where both the high and low have exceeded the prior bar’s range.  If it breaks down from here, that is a bearish engulfing candlestick and would be an extension of the confirmed top spotter at the channel top rail–if it recovers back inside the range, that may have been it for the downside.

.

.

Screen Shot 2013-06-21 at 9.47.20 AM

.

Zooming in two orders of magnitude to the hourly bars…

As I mentioned yesterday, it is all about 1590.50 and that is our bull/bear line on the day.  The short-term trend is down under that line–but a move back up inside the range could bring the dotted line up at 1618.75 into play if the pros really get crazy on a bounce.  That is where the weekly candle opened and represents the start of the black body of the candlestick.  Exceed that and the bearish engulfing candle goes away with emphasis.

Yesterday was clearly a designated down day by the pros.  There was steady controlled selling pressure all day.  The daily bar closed near the low and touched the measured move target at 1581.75 that I pointed out from the broken pennant pattern in previous posts just before reversing to a bounce.  If that holds as a pullback low–that was a pretty slick call, but we’ll see how it goes.  At any rate, that extension target was obtained for any counter-trend alphas that followed the trade from the trigger and the backtest entries and was a great trade setup.

The business of today will likely be to expire individual options in such a fashion as to render as many contracts as possible unprofitable to the holders–but could also turn into an opportunity for decent gains for those who bought contracts jettisoned during yesterday’s panic.

The bull/bear line is 1590.50–short-term bias is bearish below, reversing back to bullish above.

…my .02

.

.