Wednesday the ES successfully tested the 1985 level and bounced from it in overnight trading prior to yesterday’s open. Thursday the market stalled in a relatively narrow range all morning; but shortly after the European close it turned around and rocketed straight up 35 points into the close.
Price action was bullish – five consecutive green hourly candles, nothing red all afternoon. The Fed did a great job to promote the price.
Today is October option expiration. ES will try to hold up until Cash index options settle at 9:45am first. After that ES can go up or down without constraint.
Download the full trading plan here: 151016
The 200-day moving average line above the current price,at 2025.50 will be an important line.If it is broken, it could create a strong bullish move and push ES higher up to 2033-35 zone to test the Aug 24 broken support zone.
A failure to break out, but instead a move under 1995.50 will be bearish. A further decline toward yesterday’s Globex low could be seen. But expect to see buying on the dips if ES drops near 1989-85 zone.
Short-term === Bullish
MEDIUM TERM === Neutral
LONG-TERM === Bullish
Support and resistance
The major support levels: 1928-29.50, 1900-03.75, 1880-75, 1850-45,
the major resistance levels: 2025-32, 2042-40.50, 2050-46.50