December 27, ES Premarket Missal
One out of a dozen.
Image 1. A very lonely seller. 12 Angry Men, 1957
Minister’s Missal
The upward grind is relentless. Yesterday’s premarket plan suggested buyer strength in the case of strong closes above the ONH/4815 on the 15m or the hourly. This is how the open played out, with dips bought for returns over the magic number 4815. The pivot area (4805) was untouched at the opening bell, another potential sign of strength.
Image 2. ES Tuesday ETH open
With the exception of the closing inventory correction in M period the entire session was spent OTFU. Indeed while ES made a new ATH this was insufficient to see new participants join in. The failed breakout above 4826 in L period was rejected on low volume - this level will thus be our focus for today as a potential pivot.
Image 3. ES Monday RTH and Tuesday ETH as of 8h20 EST
Wednesday Plan and Levels
Pivot 4826. Plan largely unchanged as we continue to grind slowly up. We saw around half a million contracts traded yesterday, remember that these low volume environments can be conducive to outsized moves if heavy volume appears at either side of the distribution.
a) Support at ONL/4815 could see a break of ONH, a ‘buy the dip’ scenario. This would aim for a retest of 4834.50 ATH, potentially supported by retests of the pivot - followed by 4845-50, a zone where sellers may step in. Heavy size could target 4857, 4870 - refer to the weekend outlook for notes on the last level.
b) Sellers meanwhile can potentially trap buyside liquidity above 4830, keeping pressure below pivot aiming for a break of 4815. Consecutive strong closes below VWAP (continuous) targets PDL 4808, with 4790 potentially the next stop. Buyer support in the case of aggressive selling may come in at HVN 4776.
c) The VIX was under pressure in Tuesday’s session lending to continued upside movement. Note the key buyer level 13.20 broke in the afternoon, coinciding with the successful break into a new ATH (on ES). Further pressure below 12.80 favors the buyers, while sellers prefer to see the index return above 13.40.
Image 4. VIX as of Friday, Dec 22. Overnight in grey
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