ESH6 Daily chart

ES had a second straight day of gains on Tuesday and closed close to its 10-day moving average line. The price action was bullish and strong, but the volume was slightly lower than the previous day.

Today is Fed Policy announcement day. The rally resulted from shorts covering before Fed meeting. The FOMC announcement and chair’s press conference could rock the market again this afternoon.

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Traders will have to pay attention to the resistance at 2055-65 zone, above the current price. A failure to breakout this resistance, but instead falling back to the 2031.75-29.50 zone, could send the ES back down to yesterday’s Globex low around 2009.50-2010 area again.

2056.50 controls the upside movement and 2028.50 controls downside movement. In overnight trading ES may stay in the 2050-2028.50 zone. In the afternoon session today, after the FOMC announcement, we could see a brief “sell the News” movement around 2:15pm, and a bounce in the last hour or tomorrow. Anything can happen on FOMC day, Stay cautious.

Outlook

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

Support and resistance

Major support levels: 1998.50-96.50, 1975.50-72.75, 1976-65.50, 1955-50
Major resistance levels: 2047.50-52, 2088-89.50 2105-08, 2114.50-16.50