1) Context: today’s daily price action was telling because it shows orderly selling and it developed lower highs and lower lows for three days in a row. This could signal a sharp break lower tomorrow.
ES context May 17
Price remained imbalanced lower for most of today’s trading session with value between 1331 and 1343 with fairest price at 1337.50. I will maintain the same buy/sell zones as yesterday.
ES levels May 16 (click to enlarge)
2) Structure: price failed the attempt to return to prior range and started to trend lower closing near the low of the day. I drew another extension of the lower pitchfork to the upside which aligns with the high of the pit session.
ES structure May 17
Scenarios for today:
- I would like price to make an attempt to return to value near the 1331-36 area either overnight or during the pit session. A rejection in that area would signal an ensuing auction lower
- We could see a balanced day today since price is near a multi pivot line. The balanced day could be contained within yesterday’s range. Low volume in the first timeframe (9:30-10am) could be a heads up for balanced day
Today’s scheduled events:
- 8:30am – Unemployment Claims
- 8:30am – Treasury Sec Geithner Speaks
- 10:00am – Philly Fed Manufacturing Index
- 10:00am – CB Leading Index m/m
- 10:30am – Natural Gas Storage
