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Good Wednesday morning,
It was another epic battle yesterday between the bulls and the bears, and it can best be described as one big game of tug of war! At times during the trading day Tuesday, both the bulls and the bears had their own moments of greatness, where it looked like one side was going to dominate the other. However, the back and forth fighting was an incredible sight to see. When the closing bell rang and the dust settled, the bears won the day! It was almost a draw, however, late in the session, there was a significant liquidation break and the close definitely swung to the sellers!
Now that being said- my, how things can change fast. When the futures reopened at 6:00 PM EST, both ES and NQ futures exploded higher on the news of trade talks between the U.S and China. That single 15 minute bar between 6:00 and 6:15 PM EST set the high and low of the overnight session, so 5689 all the down to 5606 will be the new key trading zone to watch for the next move, either higher or lower. As if that weren't enough, one more thing to stir the pot...today is Fed Day so we most likely will see balance and responsive trade back and forth before the FOMC decision at 2:00 PM EST, then the FED Chair press conference at 2:30 PM EST. Honestly unless you are a seasoned trader and can trade both sides, back and forth quickly, it is best for most to sit on hands as the moves will be violent. There will be great intraday opportunities but also great risk on days like this. Consider this a fair warning.
In the profile pic and key targets below, you can see the large overnight range, marked by the two circles, and that huge range was set in a single fifteen minute bar! That shows the potential volatility for today! We also have many important data points within that that zone, so we still have an edge over other traders. If the buyers can keep price above 1/2 back at 5639, and the POC (Point of Control) at 5643, then the short term edge would swing to the bulls, so look for prior day's high and upper targets. If the sellers take price down and keep them below the mentioned levels, then the edge would swing to the bears so look for lower targets.
Futures are trading at 5650 at the time of this writing.
VPOC Update: No new VPOC's added or taken out yesterday, so the closest above is still at 5709, and the closest one below is at 5536. We have 7 above and 16 below.
TARGETS AND KEY LEVELS TO WATCH:
/ES upside target is: 5695 - 5705
Key Levels: 5643 POC and 5639 1/2 back
downside target is: 5600 - 5590 then 5565 - 5555
/NQ upside target is: 20,150 - 20,200
Key Level: 19,900 POC and 19,882 1/2 back
downside target is : 19,740 - 19,700
/RTY upside target is: 2015 - 2025
downside target is: 1970 - 1960
Economic Data: ( *Red Star*)
MBA Mortgage Applications @ 7:00 AM ET
EIA Petroleum Status Report @ 10:30 AM ET
4-Month Bill Auction @ 11:30 AM ET
*FOMC Announcement @ 2:00 PM ET
*Fed Chair Press Conference @ 2:30 PM ET
Consumer Credit @ 3:00 PM ET
More Color By : Rich Rickus
- /ES - Key Demand $5600 then at $5530 with Supply at $5675
Bullish : Sellers trapped above $5675 looking to play a break and retest above $5680 long targeting $5710 then $5725
Bearish Buyers trapped below $5600 looking to play short after a break and retest below $5590 targeting $5580 then a break down into $5550
- SPY Key demand at then at $554-555 with Supply above at $562-561
Bullish Sellers trapped above $562 looking to play a break and retest from $563 long targeting $565 then a breakout mid high $566s
Bearish Buyers trapped below $554 after a break and retest below $553 targeting $551’s then a breakdown into $549’s
- /NQ Key Demand at $19700 with Supply above at $19950-19975
Bullish Sellers trapped above $19975 looking to play a break and retest above $20000 long targeting $20,100 then a breakout back into low $2200’s
Bearish Buyers trapped below $19700 looking to play short from below $19650 targeting $19550 then $19475
- QQQ Key Demand at $478 with Supply at $485
Bullish Sellers trapped above $485 looking to play a break and retest from $486 targeting $488 then a breakout into low mid $489s
Bearish Buyers trapped below $478 looking to play a break and retest short from $477 targeting $475 then $474s
Have a great day!!
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