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Good Wednesday morning!
The bulls put in another decent day yesterday, although it wasn't as strong as Monday. The market did what was expected and as we mentioned...
"A pullback to the POC is OK and also bullish. It is what we call "Runner's tagging up." Remember, the POC (Point of Control) is where the most amount of volume traded yesterday, so a lot of business was transacted at that level, so traders and investors feel comfortable being long the market as long as price is at or above that level of 5814."
Well yesterday's low was only 5809.50 so buying the pullback was warranted. Price did not even get down to 1/2 back or VAL at 5800 so that is another testament that the buyers are still in control. For today, this is going to be a little different but also straightforward so please pay attention.
The overnight range is completely inside of yesterday's rather "squat" or "compressed" range. This is what we call "balance"! Markets don't rip straight up or straight down every single day. There needs to be times of consolidation in the markets. and today could be one of those days.
In the profile pic and key levels below, it is very straightforward for today once more. Any price action that stays between the prior high at 5837.25 and the prior low at 5809.50 is balance. Think of it as a pause and tug of war between buyers and sellers. Buyers still have the upper hand at this time, so as long as price does not drop sharply below yesterday's low and lower targets, then the path of least resistance is still higher. Any breakout over 5837.25, then look for upper targets and then 5900 is the next stop. I don't necessarily mean today, but in the near future! Futures are trading at 5829 at the time of this writing.
VPOC Update: No new VPOC's added or taken out yesterday, so we still have 6 above and 22 below.
TARGETS AND KEY LEVELS TO WATCH:
/ES upside target is: 5845 - 5855
Key Levels: 5827 POC and 5837.25 Prior High
downside target is: 5815 - 5805
/NQ upside target is: 20,625 - 20,655
Key Level: 20,426 POC
downside target is : 20,85 - 20,355
/RTY upside target is: 2130 - 2135
downside target is: 2100 - 2090
Economic Data: Busy Day Red Star Event
MBA Mortgage Applications @ 7:00 AM ET
Durable Goods Orders @ 8:30 AM ET
EIA Petroleum Status Report @ 10:30 AM ET
Treasury Buyback Announcement @ 11:00 AM ET
Treasury Buyback Announcement (Preliminary) @ 11:00 AM ET
Survey of Business Uncertainty @ 11:00 AM ET
4-Month Bill Auction @ 11:30 AM ET
2-Yr FRN Note Auction @ 11:30 AM ET
5-Yr Note Auction @ 1:00 PM ET
Alberto Musalem Speaks @ 1:10 PM ET
Treasury Buyback Results @ 2:00 PM ET
More Color....... By Analyst Rich Rickus
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/ES - Key Demand $5800 then at $5750 with Supply above $5840-30
Bullish : Sellers trapped above $5800 looking to play a break and retest above $5810 long targeting $5820 then $5840
Bearish Buyers trapped below $5800 looking to play short after a break and retest below $5790 targeting $5770 then a break down into $5750s
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SPY Key demand at then at $573 with Supply above that at $576
Bullish Sellers trapped above $573 looking to play a break and retest from $574 long targeting $576 then a breakout mid high $578s
Bearish Buyers trapped below $573 after a break and retest below $572 targeting $569 then a breakdown into $567
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/NQ Key demand at $20320 with Supply above at $20540
Bullish Sellers trapped above $20350 looking to play a break and retest above $20360 long targeting $20400 then a breakout back into low $20500s
Bearish Buyers trapped below $20350 looking to play short from $20300 targeting a breakdown $20200s then $20100s
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QQQ Key Demand at $490 with Supply at $494
Bullish Sellers trapped above $492 looking to play a break and retest from $493 targeting $494 then a breakout into low mid $495s
Bearish Buyers trapped below $490 looking to play a break and retest short from $489 targeting $487s then $485.
Have a great day!!
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