Jan 29 ES Premarket Note
Trimming sails
Image 1. Friday RTH, Monday ETH as of 8h40EST
A quick look at the day ahead. I believe that the day will be important in setting the tone ahead of FOMC, and may even reveal clues about the direction of the remainder of the week. As I titled one of my Missals last week, someone always knows.
Minister’s Missal
My key area of interest heading into the RTH session is 4920. This had some unusual activity heading into Friday close on the tape, namely strong sell positioning that was artfully held up into settlement (4914.50). Below are some key liquidity zones around this area. Feel free to borrow them although keep in mind these can shift slightly session to session - it is meant to give a picture of where the players were positioned.
Image 1. ES current liquidity
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Monday Plan and Levels
Pivot 4920. At this time I am leaning somewhat to the short side as long as we do not see an hourly close above the ONH (4921.75 as of writing). Sellers will take the advantage with momentum breaking the PDL.A defense of 4910 by the longs could set up a run at Friday highs, and confident break there may have as targets 4944 to 4955.
a) Defense of 4910 can target a break of 4922, with 4927-30 above where the large seller from last week may enter the picture. A close above here may attempt trade into 4942, 4955.
b) A look above and fail scenario (which I like to write as LAF) possibly rejecting ONH or 4925 ultimately targets a traverse of the ON range. A break of ONL can see 4895, below which things can get interesting if passive buyers are overwhelmed. Further targets 4884 where passive buyers may be found, to 4875.
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