Hey Traders,
futures open in about 6.5 hours and kick off a big week which will give us some more direction as to where the market will go intermediate term, with trying to chop everyone up in the process of course.
Here is what trend summary looks like at the close on Friday March 27:
After much chop the past several trading days, ES 120min , 60min trends are bearish with 100k contract trying to close second candle green suggesting we could be starting a new short term bull trend, trend is a great indicator for possible new trends starting after an extended move and not so effective when trading and chopping around in contracting range as we have been. After huge down day with closing under S2 for the euro no surprise most time frames are looking bearish.
On the daily the big ambush zone of 1.3571-1.3834 prevailed and euro found support at 38% retracement of the recent rally:
Trend is still green, even though euro has clearly broken down, another very significant even is that this was first close below the low of the high candle of this rally (only true way to catch tops, more on that in education posts)
Here is a drill down on the Euro on intraday time frame:
After this big break down euro is still flirting with the bottom trendline of the megaphone formation that has been a great guide for price action over the past two weeks. After such big move at least a small retracement is expected with two possible resistance areas, firstly ~1.3425 area with purple line being previous low , usually a high probability bounce area by itself, which just so happens aligns with an ambush trade. Another area is 1.3497, which is ambush from the highs of the rally which also happens to be at previous support area which has been tested numerous times in past week.
Now lets have a look at ES dailys
Since last post no trendlines have been violated and Friday was an inside day suggesting big move to come very soon, “crossroads” of all the trendline are crossing on what will be Wednesday, so I am expecting very large move by then that should give us some sense of direction.
Now lets take a closer look at ES emini:
ES is currently in a working ambush trade from 792.50 with a target of 838, which is right in the ambush zone from 1004 high to 662.5 low. Es has also been trading in a rising wedge with breakout/fakeout to the upside and then a breakdown being a rather high probability scenario. For short term clues watch the 808.75 level which is 50% retcement from Wendsday lows, would fully expect a bounce in that area, especially if that level ligns up with the bottom trendline of the wedge when reached. Same goes for 820, break above 822.50 would really increase the odds of retesting the highs of the rally and entering 833.5 ambush zone.
Good luck this week and keep checking back for more daily and intraday updates!