Trading plan for Sept. 16, 2015

150915-ES-daily

ESZ5 Daily chart

ES attempted to break its triangle pattern to the upside yesterday. Both the Retail Sales and Empire State Mfg reports were below expectations. But the poor results persuaded Wall Street that the Fed may postpone a rate hike, and triggered buying. It was enough to make the players forget – temporarily – that the Chinese market dropped another 100 points Tuesday. This week, only the Fed matters.

The FOMC meeting begins today. Before it begins there are lots of economic reports to be released in the pre-market session. The ES could continue to move up in the early sessions.

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Download the full trading plan here: 150916-plan

1965.50, the monthly pivot, should be the first level to watch. As long as ES manages to stay above it, the odds favor a challenge to the 20-day moving average, and will keep pushing the price up to 1975-95 if the 20-day m.a. fails to hold the ES down.

But traders also need to be prepared for the possibility that the ES may pull back sharply if there is a leak of information from Fed – or even a rumor of a leak. Any break of the support in the 1953-65.50 zone will cause a price reversal.

Outlook

Short-term — Neutral
MEDIUM TERM — Bearish
LONG-TERM — Bullish

Support and resistance

The major support levels: 1900-03.50, 1975-80, 1850-45, 1828.50-25
the major resistance levels: 1992.75-95.50, 2012.50-2013.50 2032-2035

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