Market continues to show weakness. As expected, the 1300 level on the ES proved to be a great long entry yesterday. The bounce, however, has fallen short of being something that can be attributed to strength. It was a technical short term reversal off solid support. I expect a retest of the lows to come soon, very possibly today. There remains solid support just below yesterday's lows. I will look to get long again if the ES sells down to 1296-1297.
An alternate scenario that could play out is that we see continued strength this morning. CPI data (excluding food and energy) came in slightly lower than expected this morning resulting in a little buying momentum. If more buying comes in after the open and the ES confirms a move above 1314-1315, that will just delay the continuation of the latest down-turn until next week. As long as the ES does not trade back above 1328-1329, I will continue to consider the market weak and expect a lower low.
Levels to watch today on the ES:
Resistance above at 1314-1315, 1317-1318, 1320-1321
Support below at 1305-1306, 1301-1302, 1296-1297, 1292-1293
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Short ES at 1317.75
ReplyDeleteI'd like to see a dip back below 1313 before I cover this trade...
ReplyDeleteScratch the trade. Have to wait till next week, sigh...
ReplyDeleteEnjoy the weekend