Thursday, November 12, 2009

Thursday - 11/12/2009 Setups

The same setups show up day after day on the 5-minute chart...

ES - 5-minute Chart

Lets walk through the day step by step and rationalize it a bit using basic concepts and S/R levels:
  • Yesterday's Low was 1091.25 (support). Price bounced off 1091.75 on the open.
  • Yesterday's High was 1103.25 (resistance). Price hit a high of 1101.00 this morning and sold off from there.
  • ES moved down from 1101.00 through the mid-point and VWAP and bounced at 1094.25 (sign that bears may be in control now)
  • Price retraced back up and chopped around the mid-point and VWAP for a bit (bulls losing the battle), and then popped up to 1099 (1098.50 was .618 retracement of the 1101-1094.25 swing).
  • Sold off again from there, and broke down through the mid-point and VWAP (bears in control), and found some support at 1090 (1088-1090 was a support level posted on earlier Key Level charts).
  • At this point, the first hour low has been established at 1091.75 and will act as an area of resistance.
  • ES sells off again, and finds some support at 1088.50 (1088 posted as Key Level on earlier charts).
  • Price attempts to retrace back up a couple of times, but doesn't manage to cross 1091.75 on a closing basis, and we see more selling pressure.
  • We get another bounce at 1087, and price retraces back to 1091 (1090.50 is .618 retracement of the 1092.50-1087.00 price swing).
  • The next area of support on the Key Levels chart was 1084.25, and we got a bounce at 1084.50.
  • Prior support becomes resistance, so we can now use the 1088s and the 1087s as resistance. Price retraced back to 1087, and sold off again; this time moving down to 1082.50.
  • Finally, ES retraced from 1082.50 back up to 1087.50, which is where it closed (1086.50 = Value Area Low).

I hope the commentary was helpful and gave you some ideas on the levels/areas to watch during the day.

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