We had some bullish momentum to open up trading this morning as the S&P 500 Index gapped above resistance and traded up in the first 30 minutes. However, buyers could not overcome multiple levels of resistance:
Resistance on the ES that sent this market back down:
1) 200 MA($1145.25) and 100 MA ($1147.75)
2) Previous support (now resistance) from 5/11 and 5/12
3) Ambush Retracement zone from the 5/13 highs
We sold off for the rest of the day and continue to sell now into the evening session as the ES has traded down to new lows. Lets see if support can hold around Gap fill on the ES which is 1106.25 to 1110.75. We must be very careful with any long positions at this point as a move below 1100 could create a substantial push lower, possibly back down to the lows from the market crash on May 6th... I'll be looking to take profits relatively quickly on trades in the current range. At the same time, if I can get a good short entry, I will be looking to hold onto part of the position for a potential runner to the downside (in the event that we break below the 1100 level on the ES). There is possible support at the 200 MA on the ES Daily Chart, currently at 1094. I'm not interested in any swing long positions until we confirm a trend reversal back to the upside.
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