Trading plan for Aug. 11, 2015

150810-ES-dailyThe ES gapped up strongly in the pre-market and at the open after Stanley Fischer, the vice chairman of the Federal Reserve, said the feds see no rate hike until inflation returns to normal levels … i.e. not in September. The ES then fell into a very narrow sideways range to the close.

The futures closed at the top range, but the total volume was less than 30% of Friday’s volume, and most of the rally occurred on very thin volume.

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Download the full trading plan with the buy/sell numbers here: 150811-plan

Today we need to see a follow-through before we can say the ES has confirmed the reversal of the recent decline. Absent some follow-through, and especially if we continue to have weak momentum and weak volume, the price is likely to pull back down to fill yesterday’s gap in the next few days.

However if the price holds above 2093.75 in overnight trading a continuation high move could be seen first, and last until the ES finds its major resistance during regular trading hours. At that point there should be some retracement.

External events and news will directly influence price moves. The triangle pattern on the daily chart could confine the price in the ultra-short-term, but eventually ES has to make its decision on which direction it wants to go. A break above 2110 level can lead ES to go back 2123.50-2125 zone. A move below 2062 can lead ES to drop to the 2050-35 zone. A big whipsaw move is likely to be seen today.

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

The major support levels: 2054-55, 2035-32, 2025-23.50, 2018.50-16.50
the major resistance levels: 2128.50-29.50, 2134.50-36.50 and none

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