Review and Preparation ESH4 January 20th-24th, 2014

Notes: Post market close, Thursday.

  • The first chart below shows the daily bars for ESH4 at the end of trading on Thursday.  Thursday was a big down day. From the open of the RTH session price in ES moved down.  Late in the day,  starting around 2pm price rallied up.
  • Before the late rally up, the daily bar set new lows for the week and it closed below the earlier low from Tuesday.  The low of Tuesday has been violated and broken with Thursday closing below it.
  • However, the low was at an earlier support level just above 1811, which is just above previous resistance now support and the 38% of the most recent impulse up leg.
  • If the 38 fib cannot hold look for support at previous resistance at 1806 or lower to the 50% fib at 1800.
  • The interim support level, at around 1830, that held for 7 + trading days was also broken as the day closed below it.
  • Careful with rallies above 1830 as a new high above 1846 would have to be established to confirm a up trend continuation, though a down trend has not been confirmed.

Preparing for the Thursday RTH open

  • Over night session was down, look for the big 5 minute volume bar within the first 30 minutes to 1  hour of RTH open, that should give an indication toward direction.
  • Support is around 1826, but if price get there then the interim support would be violated maybe look for lower support at 1817 and even down to 1810 though 1810 would be a big move down for one day.
  • Overnight volume was 280,000 and price was sharply down off strong resistance area, look for short trades.

Reviewing up to the end of Tuesday Jan 21st trading day in preparation for Wednesday trading

Review and observation before RTH open Wednesday:

  • Overnight high 1841.25 which happened at around 12:00 am.  The overnight low 1834.75 around 6 am.  Volume was 171,000

Review and observation after Tuesday’s close:

  • The open of RTH at 9:30am EST started a down move about 16 points down.  Support was found near Friday and Monday’s low about 1827.
  • From the low price moved back up sharply up almost 13 points and closed the daily bar white and up.
  • If the interim support around 1828 get broken look for 1809 to possibly be next area of support.  However, do keep in mind 1809 was a new low breaking previous interim support last week.
  • Watch for reaction off the resistance area between 1841 to about 1846.  If price get above here wait for the daily bar to close for full confirmation of a possible move further up.  1852 is a 1.618 fib extension level, may be resistance with possible sellers there?

Monday is a holiday in the US so expect the markets to be inactive with little to no volume.

With little going on Monday, here is a quick look back at the 2013 on the weekly chart.