S&P Daily Pre-Market Prep 5/23/17

Posted by Peter Davies on May 23, 2017

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We are now at the top of the range again. So on the lookout for a rollover/headfake or potential move to new highs and a new range.

As before...

Quoting 

Which is saying it is going to go up or down.

Headfake - will pop the top and see absorption and sellers piling in
Break upside - will see a move up without the stopping volume we see in the headfake, for me the safest option is to go long when it falls back to the old high
Reversal down - any downside move with overwhelming volume

So while we are saying "it will go up or down" - we do have some things to look at for confirmation of which scenario is playing out.

In terms of "which prices to trade" - well - it's anywhere around here. No specific price, just specific action to look for.

 

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From a weekly profile perspective, we still need to get past the top distribution - not really much of significance other that we can see this also puts us above the major distribution from the week before. So above 2401, there's nothing in terms of historical trade to 'slow us down'.
 
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Yesterday was a very narrow day, yet with very decent volume. We do have upside momentum but against the range high. So no real bias.

Plan
- No bias but an open mind about where we could go - in particular keeping an open mind about the upside. It'll probably go down to the range low but we cannot discount a move to new highs. The trick is to play that as long as it's not a headfake.
- Early trades would be nice, especially if volatility carries over from yesterday.
- Otherwise, a wait and see for the range top to be resolved - then follow when it is

Weekly Numbers
Range - 2378.25 -> 2397.75
Value - 2380 -> 2391
S1 - 2354, R1 - 2407

Daily Numbers
Range - 2385 -> 2394.25
Value - 2387.75 -> 2392.75
Globex 2386.75 -> 2397.75

Settlement – 2392.75

Long Term Levels - 2178.75, 2129.50, 2099.75, 2084, 2078.75, 2000.75, 2400
 
 

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Topics: Market Updates