posted 9.23a.m. est
from pre-open comment Thursday 7th May
>>Market is very overbought. 14day RSI above 70 now for a number of major charts and VIX closed lower still.
We’re pushing the time pivot window here. Dayframe we have to expect higher but Longframe the break above 872 could be one almighty bull trap.<<
Pre-open Friday 8th May
Significant Sellers were marked on Thursday. They responded immediately after the open (red at top). This was the first time I have marked Responsive Selling (red at top) since March 19th.
The Value Area was overlapping/lower and there was more volume generated. ES also broke below First Level Support at 915 early on in the session which indicated weakness and it traded as low as 898 later in the day.
The odds indicate that on a day following a day with red at top, there is a 70% chance that the previous day’s low (898) will be broken. That is a stat worth remembering if ES trades back below 914 which is Friday’s First Level Support and also 1/2Range. However, ES has recovered more than 70% of Thursday’s loss and currently prints above that level which is a minor sign of strength while it lasts.
A shift in control away from the Buyers will nearly always start with a marked response from the Sellers like this but until we see Effective Selling (active Sellers generating a lower, wider VA), we have to assume Buyers are still in control.
