There was certainly plenty of market movement this morning. The ES opened in our 68.25 / 69 short fade area and I thought we might have a quick morning as we stalked a short setup. But alas, the market broke up and quickly moved into the 71/71.75 area. This area provided strong resistance and a 4 point rotation down, but we never got a good short setup. Around 9:45am EST, the market starting making another move up; this time to our 77.75/79 area. Finally a big lots setup on the 10:06am up rotatation 6 PnF bar. Since volatility was so high, a little improvisation was needed in setting a target. The target in the trading plan was 1076, but the entry area at 1076.50 which is awfully close (unless you just wanted to take a 2-tick scalp). Using the volume profile, 1074.50 could of been used as reasonable target or 1073.25 as an aggressive target which was also the VWAP.
If you missed that big lots setup, another trade big lots opportunity happened on the move back down into the 1071 – 1071.75 area. This is a case where previous resistance has now turned into support. This was not a potential trade listed on the trade plan this morning because price was well below this area at that time, but these sorts of opportunities do come along often.
There is a lot of acceptance above the current 1079 intraday high and price will have to work to get above 1082. I suspect the market has stretched out enough for a while. That’s not to say it won’t break to new highs later today, but right now the market is taking a breather.