CME_MINI:ES1!   S&P 500 E-mini Futures
Yesterday’s price action was a bit unexpected due to earnings outcome. However, while price went up, it was not very convincing, due to the pace and low volume . Divergence remains.
Overnight session remained within the value area low of the previous session. Towards market open, price pierced yesterday’s POC and pulled back to the bottom of value area high.
Based on the pullback, the price is likely to test overnight lows or retrace to overnight POC before resuming higher to retest yesterday’s high.
Lack of convincing price movement backed by volume leads me to suspect something else is happening. (Today there are a few things on the economic calendar). Therefore, wait for the initial balance to be established before entry.
May 01
Comment: Fantastical end-of-day price action yesterday! The move from 2951.75-2956.50 was one sided trading; dragging all those positioned for a short higher (trapped sellers). I warned about a trap in last couple of days. What’s likely to happen now? – probably keep the shorts in the chop until they puck before taking the price lower and then higher. Why do I think the price will continue higher once the weak longs have been shaken out – earnings where pretty good last night. More cheap money expected. US-China deal will be used to wash out retail traders.
Today being FOMC-plus day, perfect for such price action. So, the idea is to sit on the side-lines and watch. Let the dust settle and then do your analysis.
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