Tuesday, February 8, 2011

E-Mini S&P 500 Futures Trade Plan for Tuesday 2/8/11

Notes for Overnight Session (posted Monday evening)
The existing S/R Zones are in-play, and we're trading in a Bullish market context. We haven't seen a blow-off top yet and the expectation is for dips to get bought.

Trade Plan for Tuesday 2/8
Overnight, ES has been consolidating within the upper half of yesterday's range, and has built Acceptance at 1315.75. Holding above 1315.75 during the day session opens the door for a test of 1318.25 and yesterday's high (1320), or even a break above it. Above 1322, the next strong resistance area is 1329-1331. I'll be watching for Responsive Sellers on first test of 1318.25 and 1320-1322, but I'll be cautious there since we tested 1320 yesterday, and 1319.75 overnight. I'm anticipating the downside to be limited to yesterday's 24-hour range, so if we get a move down towards the open gap at 1307.25, my focus will be on the Long side. As I mentioned in my Sunday evening post, the bigger picture expectation is for the market to develop a balance area at higher prices. We haven't seen a blow-off top or exhaustion yet. I'm anticipating the upside to be capped at 1326, or 1329-1331 (extreme). Expecting a range-bound, balanced session. Buyers are in Control.

Econ Data
NFIB Small Business Optimism Index at 6:30 AM (CT), ICSC-Goldman Store Sales at 6:45 AM (CT), Redbook at 7:55 AM (CT), and 3-Yr Note Auction at 12:00 PM (CT).

5-min Chart with the EMiniPlayer S/R Zones
(will be posted later)

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