Another small range regular trading hour session in the ES Thursday, just 8 points, following Wednesday’s 9 point range after Tuesday’s pre market gap higher rally. Value and the point of control closed higher from the previous day.
Long inventory risk in the ES appears to be very high as traders were again buying at very visual, mechanical references, notably late Thursday at the I and K bar lows (just a tick above prior day session high) and the later J period pullback low, mechanically one tick above halfback. These levels have high odds of being revisited.
Looking like the profile would leave another poor high with no excess on the matching F/G/H bar highs, price traded to within two ticks of repairing the last remaining poor high from June 26th at 2447.50 in the final 30 minute trading period, but fell back to close two ticks above the very prominent twelve TPO wide point of control.
Depending on where the market opens on Friday, potential balance trading scenarios could play out in relation to the two day range:
– Look above 2447.00 and accelerate higher. The all time high would be the initial, obvious target at 2451.15.
– Look above 2447.00 and fail to find acceptance/continuation, and trade back into the prior range. Potential destination trades below the very prominent point of control at 2447.75 are Thursday’s low at 2439.00 (would stop the daily one timeframing higher) and potentially the top of the gap, Wednesday’s low at 2434.75.
– Look below Wednesday’s low at 2434.75 and accelerate/finding acceptance/lower value, targeting the bottom of the gap at 2430.00
– Look below Wednesday’s low and fail to find acceptance/continuation and return back into the two day range, potentially targeting the upper end.
– Although probably unlikely, there is always the possibility the market remains in balance.
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