2013-01-22

$ES_F : 1473-1483 : Expected day session range for EMINI


Long set-up still in play.

Attempt at new highs. Bullish.


After the holiday markets are likely to find support at 1473-76 and build next move up. Top of the breakout range at 1468 is support. The long set-up was confirmed on Friday. Possible resistance is in 1486-88 area after which 1500-1520 is next target.


Today I would expect 1476-73 as area of support. I will update the comments section as the day develops. Factors affecting the rally are



  • Markets have broken out of a trading range. Top of trading range is now support.
  • VIX term structure has steepened once again and pick up in VIX can derail the rally. 3m spread is 3.18. 
  • The rally which started from 31st Dec 2012 has met its initial target at 1468 but now appears to be extending. This should carry the momentum in favour of longs for sometime until 1488 and if possible, beyond.

So far shorts have not managed to show a follow through and hold a short set-up for more than 1 day and therefore the balance remains on bullish side.

My initial bet would be for minor support at 1473-76 area to hold leading to a build up to 1483 and higher area. I would expect high of day in the region of 1481-86 area given 8-10 point expected range. 
If after breaching 1470, the market is unable to rise above 1478 I would need to reject the bullish case temporarily and expect further move down.



Main support for longs is at 1468-70 area.