posted 6am EST
from pre-open analysis on Monday
>>If price holds the minor support at 774 during the day session today then we can expect higher prices in the near term and I’ll go flat. Any price action below 769 would suggest a test of Friday’s low is a possibility today and so is a fast rejection (test-reverse) if that happens.<<
Price failed to hold the minor support at 774. ES opened just above that level and responsive sellers appeared immediately to auction the market lower. There was a minor consolidation below 769 and then it was lower for the rest of the day to the close, taking out Friday’s low early p.m.
I see five instances of significant selling activity (red) in the last five days and no significant buying. Every day has seen a lower value area. This is effective sellers in control, taking any rally above the previous day’s value area as an opportunity to enter.
There was responsive and aggressive selling yesterday generating a lower, wider value area with less volume than Friday (but above the 20 day average).
This suggests that yesterday’s low at 739.75 will be tested at some time today and that most of today’s price action will take place in an area lower than or overlapping 742-760.
By my criteria we’ve only see one instance of significant (but ineffective) buying since this down auction began on 9th February taking ES all the way back down to approach the November low which is 737.25. Maybe a test will flush out the responsive buyers. I remain short.
