Trading plan for Feb. 2, 2016

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ES had a very small gain yesterday. It seems buyers made lots of effort to hold price up. Even though the price was pushed up to 1940 after the bond market closed yesterday, it still sold back down to 1931 for closing at the end. That was not a bullish move.

The short-term indicators start to get an overbought condition. Whatever high is made this week is likely to be the top for the short term. The A-B-C pattern final target is at 1962.50. In order to reach that target both 20 and 10 ema lines must hold up ES. A move below 1900 level will indicate that the short-term top has been posted, and a further decline should be expected.

Today 1917.25 is a key line. Holding above it could push ES back up to yesterday’s high area. But failing to hold up, could push ES back down to yesterday’s low or lower toward 1907-03 zone to retest the psychology support line. A strong trend day may triggered by moving below 1912.50 level.

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

Major support levels: 1850-45.50, 1830-1825, 1816-1818, 1800-1795
Major resistance levels: 1956.50-55.50, 1967-69, 1975-82