posted 07.22am EST
from pre-open analysis 03-04
>>today’s resistance zone 705-707. If ES manages to consolidate above this area the rally may extend but that’s unlikely….Stats indicate that any probe above yesterday’s value area high at 705 is likely to find sellers responding. It’s unusual to see a decline of any degree terminating on a day with significant sellers active like yesterday. I’m not interested in the long side on any timeframe until we see significant buyers responding.<<
ES did consolidate above 705-707 and the rally did extend. I thought that unlikely. Following a day of active significant selling (like Tuesday) it is rare to see the high of that day-session being exceeded the following day without the low being tested first.
Sellers did respond aggressively but higher than I expected. Pre-open (7am est) ES currently printing back under 700.
I have said I’m not interested in the long side on any timeframe until we see significant buyers responding.
We have seen no significant buying now (green) for six days. I have to assume this market wants to go lower. Risk is way too high for me to attempt longs. With price location the way it is there is still a high risk of another sell-off.
I’m using the same reference area today as yesterday which is 705-707. If ES manages to consolidate above that area we could see more upside and I won’t look to short.
The more time ES spends below 705 the greater the chance of a new low for the week. If we open below 705 , an early rejected probe above that level could bring out the sellers again.
