The Fed kept interest rates unchanged yesterday, as the Street expected. The market’s response was muted; the price stayed inside the 20- and 40-day ema lines. FOMC days are having less impact as traders come to disbelieve the Fed’s promises/threats to normalize rates… sometime.
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Today the range from 2080 to 2055 will remain the fighting zone. The Bears will continue to defend the 2080-83 resistance zone and Bulls will still try to hold the price above the 2053.50-50.50 support zone.
The important thing for the traders is to be prepared for the breakout move. A break of either resistance or support could trigger a big stop run.
The daily PMO indicator continues declining and gives a short-term bearish outlook. This suggests there is a great chance to fall even though the ES could reasonably have an ultra-short-term oversold bounce after five days of decline.
The major support is lying at the 2025-20 zone. A break below 2050 level should open a door toward that support area. Only if the 2055 level is held up today could the ES go back up to retest 2080-85.
Short-term === Bearish
MEDIUM TERM === Neutral
LONG-TERM === Bullish
Support and resistance
Major support levels: 2055.50-53.50, 2043.50-42, 2035.50-32
Major resistance levels: 2085.50-86.50, 2093.50-95.50, 2100-03.50, 2114-15.50