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Good Monday morning!
We hope everyone had a wonderful Holiday and we now look forward to the New Year!! I wish I had more cheery news to share with everyone this morning but the storm clouds are rolling in fast!
After the FED Day drop back on 12/18, the market seems to have been trying to recover the drop fully and push back to new all time highs, however, after the almost 75% recovery of said drop, it seems that was all the buyers had left in their tanks!
Thursday's high last week is now a confirmed lower high and it seems the pendulum has definitely swung back to the sellers. Unless the S&P can get back over 6006, and 6036 in the ES futures, then look for more downside! And after all that being said, this mornings action confirms that to me even further!
Sellers this morning started their operations @ 7:00 AM EST and then there was a much larger, subsequent flush down @ 7:30 AM EST on no news whatsoever, so this tells me the tide is turning and people are heading for the exits! We are already below Friday's low and overnight inventory is almost 100% net short on a true gap lower, and on top of that people are trapped above, so this is a recipe for lower!
In the key levels and profile pic below, as mentioned, price is trading below Friday's low and we are also below our downside target levels already so this is quite bearish right out of the gate. If price cannot get back into prior days range, then the expectations are lower for the foreseeable future! If sellers keep price below 5982.75, then look for the additional lower targets of 5950, then 5915, then ultimately the Friday December 20th low of 5866! I am not saying we will hit all these levels today however please make a note of them! Futures are trading @ 5956 at the time of this writing.
VPOC Update: A new VPOC was added Friday @ 6100 so we now have 4 above and 26 below current price with the closest sitting @ 5870.
TARGETS AND KEY LEVELS TO WATCH:
/ES upside target is: 6055 - 6065
Key Levels: 6027.25 POC 6019 1/2 Back 5982.75 Prior Low
downside target is: 5990 - 5980 then 5950 then 5915
/NQ upside target is: 21,825 - 21,850
Key Level: 21,642 POC
downside target is : 21,530 - 21,500 then 21,325
/RTY upside target is: 2280 - 2295
downside target is: 2240 - 2230
Economic Data:
Chicago PMI @ 9:45 AM ET
Pending Home Sales Index @ 10:00 AM ET
Dallas Fed Manufacturing Survey @ 10:30 AM ET
3-Month Bill Auction @ 11:30 AM ET
6-Month Bill Auction @ 11:30 AM ET
More Color....... By Analyst Rich Rickus
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/ES - KEY DEMAND $5960-70 with Supply $6100 - 6110
Bearish
Buyers trapped below $5960 after a pullback below $5955 - 50 looking to play SHORT targeting $5900 then $5860
Bullish
Sellers trapped above $5980 after a break and retest above playing LONG targeting $6100
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SPY - Demand at $591-592 with Supply at $595-596
Bullish
Sellers trapped above $595 after a break and retest above $596 looking to play LONG targeting high $598 then breakout into $599
Bearish
Buyers trapped below $594 after a retest from $593 targeting $592 then breakdown into $591
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/NQ - Key Demand at $21460 - 21500 with Supply at $21900-21965
Bullish
Sellers trapped above $21450 looking to play long after a pullback holds above $21500 targeting $21600 then $21650
Bearish
Buyers trapped below $21450 looking to play SHORT after a pullback holds below $21400 targeting $21300 then $21200
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QQQ - Key Demand at $518-519 with Supply above at $523- 522
Bullish
Sellers trapped above $522 looking to play long from a break and retest at $523 targeting high $524s then a breakout into $525 and $526
Bearish
Buyers trapped below $522 after a break and retest below $521 looking to play short targeting $519 then mid high $516s
Also watching
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TSLA - Supply flipped to Demand at $426- 427 with Supply at $440-439
Bearish
Buyers trapped below $439 after a break and retest from $438 looking to play SHORT TARGETING $ $434 then $432
Bullish
Sellers trapped above $439 after a break and retest from $440 looking to play long targeting $444 then $446
Have a great day!
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