posted 9.24a.m. est
from pre-open comments Friday 8th May
>>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.<<
Pre-open Monday 11th May
Last week I marked three instances of Significant Buying and one of Significant Selling (Thursday). The last time I marked a week when there was more Significant Selling than Buying was the week ending Friday March 6th which was the low day of this rally.
Last Friday I was expecting a break of Thursday’s low but that didn’t happen. Significant Buyers were active once again generating a higher, albeit narrower, Value Area on less volume. In the dayframe we are still waiting for an Effective response from the Sellers so Buyers remain in control for now.
I haven’t given up on the early May time pivot although this week pushes the limit in time. Bullish sentiment increased measurably (as expected) after ES broke above the 872 resistance e.g. the London Times declared the bear market is officially over in one article and encouraged readers to “fill your boots.” That fits the bill from the contrarian viewpoint but Bears need to see the Significant Sellers responding more effectively.
914 remains First Level S/R (support/resistance). Pre-open ES prints just below that level.
It’s also worth mentioning that the Nasdaq100 Emini futures (NQ) currently trades below the low of the last seven trading days while ES trades above the highest low of the last seven days. That may signify just a rotation away from the tech sector which has been relatively strong over the last few weeks, or it may be more significant.
