Jul 172013



I had high hopes for a directional trend day.  The markets have been meandering around for the last week on little volatility, waiting on Bernanke’s testimony to the House Financial Services Committee.  His testimony was pre-released at 8:30am EDT which did provide nice directional movement of about 6 points to the upside, but the ES used the R1=1678.25 as upside resistance.  Price began it’s slow rotations between the DTG 74.25 and 78 levels.  Pressure was building for the ES to pop the cork through it’s 79.75 all-time highs and traders jumped the gun while Bernanke read his prepared statement which was already published 90 minutes earlier.  The tight stops were quickly run and the ES quickly retraced.  A short trade reversal opportunity of trapped buyers, but one had to be quick and a lot of guts to fade what could have been a rocket taking off.  Price action was whippy all morning as Bernanke answered questions, many related to how the Congress should act to help the economy recover.  After the testimony, the fireworks fizzled and volatility dried up.  The ES continued to rotate between the DTG 74.25 and 78 levels, but no clear order flow opportunities unfolded.  Thus, no example trade today.

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