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Good Monday morning!
The DOW & S&P continued to hit new all time highs last week and the markets welcomed the 50 basis point cut by the FED last Wednesday afternoon. I believe some shorts are still stuck from last Wednesday because the markets did not close well that day after the FED cut, and if they cut 50 basis points, then something "has to be wrong" with the economy right?!?!? However, that's not the way traders took the news! The overnight trade was extremely bullish into Thursday & Friday's session held up very well also as market participants took the cut as more evidence that the FED is orchestrating a soft landing! At least that is the way we are looking at things here at MEC! We could be wrong but any way you slice it, bulls are still in control of the current tape.
In the profile pic and key target levels below, you can see the past two days value (yellow shaded areas) and we are almost over Friday's high @ 5775 and within striking distance of the new VPOC @ 5778. The fact that we are so far off of the overnight lows signals that foreign buyers are still willing to put capital to work and the question now is what will the market players domestically do once the opening bell rings? We see that any price action that stays above 5761.50 (Point of Control) is bullish and any price action that can get above Friday's high will target the VPOC then the upper targets of 5785-5795.
Any loss of the POC to the downside would target 1/2 back first @ 5754 then Friday's low of 5733.50, then the lower target @ 5725. The game plan is laid out, now we just need to see confirmation by either buyers or sellers!!!
N.B. Please remember that the green horizontal line in the profile pic is where the futures were trading at the time of this writing! (@ 5771.25)
VPOC Update: A new VPOC was added Friday in the ES @ 5778 and the next closest one below is 5700. We now have 1 above and 23 below current prices.
TARGETS AND KEY LEVELS TO WATCH:
/ES upside target is: 5785-5795
Key Levels: 5761.50 POC
downside target is: 5725 - 5720
/NQ upside target is: 20,200 - 20,230
Key Level: 20,005 POC
downside target is : 19,880 - 19,840
/RTY upside target is: 2280 - 2285
downside target is: 2235 - 2230
Economic Data: Light Day
PMI Composite Flash @ 9:45 AM EST
FED Governor Austan Goolsbee @ 10:15 AM EST
FED Governor Neel Kashkari @ 1:00 PM EST
More Color....... By Analyst Rich Rickus
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/ES - Demand at $5725-5735 then at $5680 with Supply at $5800
Bearish
Buyers trapped below $5725 and holding below after a pullback below $5720 looking to play SHORT targeting $5685 then $5688 or NEW HOD made pre market / open with a pullback below $5769 and holding looking to play short target Friday Demand
Bullish
Sellers trapped above $5725 after a break and retest from $5730 playing LONG targeting $5750 then95
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SPY - Demand at $566-568 w / Supply at $571-572
Bullish
Sellers trapped above $568 after a break and retest from $569 looking to play LONG targeting $570 then $571
Bearish
Buyers trapped below $568 after a retest below $567 targeting $565 then $564
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/NQ - Key Demand at $19845 -19905 with Supply at $20200 -20205
Bullish
Sellers trapped above $19849 looking to play long targeting $19905 then 20050
Bearish
Buyers trapped below $19830 and holding , looking to play short targeting $19750
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QQQ - Key Demand at $476-477 with Supply above at $486-487
Bullish
Sellers trapped above $476 looking to play long from a break and retest at $477 targeting $479 then $480
Bearish
Buyers trapped below $476 after a break and retest below $475 looking to play short targeting $474 then $473
Have a great day!
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