Trading plan for March 17, 2016

160316-ES-daily

ESM6 March 16, 2016. Dsaily chart.

The US Federal Reserved decided not to increase interest rates yesterday, and that was enough to send all three US equities indices into positive territory.

The ES managed the rollover to a new contract (June ESM6) and closed above the 200-day moving average line for a second time.

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Now that the FOMC is behind us, the ES should return to its normal course. There is a divergence between the price and the MACD indicator, which should be considered Bearish for the next price move.

Also this week we expect ES to make a short-term top for a pullback next week. The resistance line of the downtrend channel is lying around 2030-2031 zone, not far from yesterday’s high, and this area is expected to be today’s top area.

1999-97 will be today’s major support. A failure to hold above this zone could trigger selling and push the price down to fill around the 1978 area. If there is a pop during overnight trading, we should focus on the selling side to anticipate a pullback move in today’s morning session.

Outlook

Short-term === Bullish
MEDIUM TERM === Bullish
LONG-TERM === Neutral

Support and resistance

Major support levels: 1960.50-62.50, 1950.50-52, 1928-30
Major resistance levels: 2025.50-23.75, 2033-35.50, 2050-55, 2075-77

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