8/7: Daily Recap, Outlook, and Trading Plan
Recap
August started off with a bearish week for ES, marking its first red week in a month. The month is historically bearish at the start but bullish towards the end. Last week saw a rare three consecutive red days, a pattern only exceeded once since the March low. A relief bounce was anticipated, with a target of 4550, which played out as expected. ES then experienced its 4th red day in a row last Friday.
Markets Overnight
🌏 Asia: Mixed
🌍 Europe: Down slightly
🌎 US Index Futures: Up
🛢 Crude Oil: Down
💵 Dollar: Up slightly
🧐 Yields: Up a bit
🔮 Crypto: Mixed
World Headlines
Bond market volatility continues as Fridays strong bounce is starting to look like a dead cat bounce this morning.
Key Structures
Several main structures are being monitored, including a new downtrend channel extending from the July 27th high. This is technically a bull flag, but only becomes one on the breakout. Inside this structure, the 4550 zone is significant, having been tested three times and failed, triggering a 50 point sell. The 4524 level is another critical point, acting as support for the ascending triangle that broke out on July 12th.
Support Levels
Key support levels include 4493, 4487, 4475-73, 4461, 4448-53, 4443, 4425-30, 4413, and 4395-4400.
Resistance Levels
Resistance is found at 4509, 4515, 4520-24, 4534, 4538, 4547-50, 4555, 4567, 4578-80, 4585, 4592, 4597, 4609, 4617, and 4624.
Trading Plan
A small long position was taken at the 4493 level last Friday. If this zone fails, the market could free fall again, with the "major" zones being potential knife catch spots. For the bulls, the key hurdles are 4509 and 4524. For the bears, the case begins on the loss of 4487.
Wrap Up
While bears remain in control, there is caution over short-squeeze risk after four consecutive red days. The general lean for today is that ES can hold the 4487-93 zone, then try to retest 4520-24, perhaps with a small dip, then try higher. If 4487 fails, the market could continue downward.
Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
August started off with a bearish week for ES, marking its first red week in a month. The month is historically bearish at the start but bullish towards the end. Last week saw a rare three consecutive red days, a pattern only exceeded once since the March low. A relief bounce was anticipated, with a target of 4550, which played out as expected. ES then experienced its 4th red day in a row last Friday.
Markets Overnight
🌏 Asia: Mixed
🌍 Europe: Down slightly
🌎 US Index Futures: Up
🛢 Crude Oil: Down
💵 Dollar: Up slightly
🧐 Yields: Up a bit
🔮 Crypto: Mixed
World Headlines
Bond market volatility continues as Fridays strong bounce is starting to look like a dead cat bounce this morning.
Key Structures
Several main structures are being monitored, including a new downtrend channel extending from the July 27th high. This is technically a bull flag, but only becomes one on the breakout. Inside this structure, the 4550 zone is significant, having been tested three times and failed, triggering a 50 point sell. The 4524 level is another critical point, acting as support for the ascending triangle that broke out on July 12th.
Support Levels
Key support levels include 4493, 4487, 4475-73, 4461, 4448-53, 4443, 4425-30, 4413, and 4395-4400.
Resistance Levels
Resistance is found at 4509, 4515, 4520-24, 4534, 4538, 4547-50, 4555, 4567, 4578-80, 4585, 4592, 4597, 4609, 4617, and 4624.
Trading Plan
A small long position was taken at the 4493 level last Friday. If this zone fails, the market could free fall again, with the "major" zones being potential knife catch spots. For the bulls, the key hurdles are 4509 and 4524. For the bears, the case begins on the loss of 4487.
Wrap Up
While bears remain in control, there is caution over short-squeeze risk after four consecutive red days. The general lean for today is that ES can hold the 4487-93 zone, then try to retest 4520-24, perhaps with a small dip, then try higher. If 4487 fails, the market could continue downward.
Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
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