ES gaped up strongly at open. After retesting the overnight high the price slipped into the day range low for closing. This is an exhaustion move which indicates that price is on the edge of a reversal.
Today is POMO day, and 1175 will become a very important level. A failure to hold up 1175 will give a hint that POMO day may no longer be effective in ramping up the market anymore. Odds will favor pushing price down.
ESZ0 Daily chart
On the 60min chart, ES could pull price a little further down to 1177.75 to shake out yesterday’s weak hands. If 1177.75 line holds up, ES could bounce up to 1188-89.50 area (short entry) or higher to 1193-96.50 (short entry).
But if price goes under 1175 line, the bulls may not be as lucky as before. A further decline to 1168.50-70 is very possible. Even though today is POMO day, it doesn’t mean that money will be on the buying side. From now on, the buy side risk is larger than the sell side.
To see more of Nat’s market calls, visit www.naturus.com. Free registration required.
ESZ0 Untraday chart 60 minute bars
