ES looking for $3670 touch or lower by end of the day today
Anything Can Happen™
- Thread starter Gaslight Capital
- Start date
$3661 >>>>> $3648 >>>> possible before the close and prolly RTH gap under on Monday.
As the title of your thread says, “Anything can Happen”. Impressive wide range bar(s) on the hourly in major index futures with YM and NIY making session highs on Friday’s close. Still, I see these wide range bars as vulnerability for correction, especially on typically lower volume late Friday sessions, contract rollovers not withstanding. I’m not looking to step in front of this, at least for more than a few minutes at a time on quick reversion to mean trades, as it could be the beginnings of a blowoff move. For most of my trading, I’m going to stay on the side of the open, average daily price, and average weekly price in determining which side of the market I want to be on.
While the extent of the end of day rally was surprising the rally was not - had been expecting a cash close at or above $3700 based on Opex and OI at the figure. Also, the low was not printed at a surprising location coming as it did from an algo HWB level (again based on the cash index).
The short indications were there and the short indications paid off (even the pre-mkt spike was itself added evidence that the short side was the right side for much of yesterday). Price, closing as it did in the high of the range, has significantly diminished the gap down scenario which would have targeted a retest of ES $3620's. Could still happen, as can anything
But the short indications given by the market were indeed prescient and provided very nice profits. The short indication also did all it ever promises to do: Either tradable pullback (offers a profit of at least 20 swing points) or a reversal. This indication had more than 20 points potential - in fact, a possible 50 to 100 points down was forecast and it gave us 40 of them basis cash). In bull markets such as we are in, pullbacks are more common than reversals by far.
Odds favor trade to $3820's before a significant reversal (300+ points). But indications are a grind at best, with the potential for a quick spike significantly less. If the market is higher this week, anything above $3733 +/- on Monday would put me on face ripper watch for a strong move to the $3820's. Failed breakouts from that level +/- and another attempt at mean reversion with a minimum short profit target of $360 down to $3575 +/- before a renewed rlly to the $3820's (and beyond possibly).
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The daily cash open is a main point of reference for me throughout the day.
Doing as you do is a smart plan
It's on.
$3666 and then $3620 ... as always, price action has final say. Those are my next two profit targets.
I'm so short my feet no longer touch the pedals.
Although Japan did not vote pass a stimulus bill over this weekend that I know of, I do note the current price of NIY is below Friday’s low.
Fed balance sheet has largest one week jump since MARCH 2020 (what is going on?), we have two approved vaccines that are being delivered to the population as we speak, and we now have stimulus bill approved (which the market knows is far to weak for the task at hand). Three months ago the ES would have been up 50 points already on "vaccine and stimulus optimism."
Add that to the price action and technical position and we have 60/40 pullback scenario. I am not "calling" a top.
Sustained trade with follow through above $3733 and we likely see a spike to the $3820's.
Is that because we've reached herd immunity?