The ES is still trading in an extended balance inside the July 27th selloff range.
Not correcting the 100% long overnight inventory (all Globex trading occurred above the prior settle) going into Monday’s regular session, the ES found support at a tick above Friday’s very wide point of control at 2472.75. Monday’s regular hours trading range was very small at just 5.25 points, leaving both a poor high and a poor low in the daily profile.
Balance trading scenarios could apply regarding Monday’s small range – look above or below balance and accelerate higher or lower, or look above or below the small balance and fail and target, at least initially, the opposite end of the balance. Remaining within the 5.25 point balance on Tuesday is highly unlikely.
Trading above Monday’s high at 2478.25 targets the all time high at 2480.50. Acceleration/acceptance below Monday’s poor low at 2473.00 potentially targets the prior daily lows and sets up the possibility of a “firecracker effect” (credit Jim Dalton), where hitting stops below one level could set off stops at lower nearby levels below.
The ES is one time framing higher on the daily (3 days), weekly (6 weeks) and monthly (9 months) charts. Trading below 2473.00 on Tuesday will stop the daily one timeframing, trading below 2463.25 would end the weekly one timeframing.
The prior week was an inside week. If price repairs Monday’s poor high and trades back into the prior week’s range, or fails to trade back above 2477.75, odds probably increase of being a failed breakout of balance to the upside, which also increases the odds of seeing price retest the prior weekly low. But all trends are up, nothing can change until the one timeframing higher stops on at least one timeframe.
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