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S&P Daily Pre-Market Prep 5/3/17

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Yesterday we had:
Quoting 

We are at the top of the range, not hit the top yet but this is a line in the sand. So we have to look out for a headfake up, a reversal down from here OR a break of the range upside and a move up to new highs.

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.


And we are in exactly the same state today! We traded the same area and settled 1 tick higher!

2017-05-03_15-19-29.png

We can see that so far this week, we are still trading around the large distribution from last week. So again watching 79.25 and 88.50 and not too keen to trade in the middle.

2017-05-03_15-32-28.png
 
Yesterday we were watching 88.50 (top of chop area) and we got to 88.75 before moving down. We never got to 79.25 to the downside. We got a short but not much more. A 7 point range and less than 1 million contractstraded. As such, I'm not looking for more levels to trade off - but feeling vindicated about sitting back and letting this play out.

Plan
- Low expectation day
- Waiting for a break - whether that's today or in a number of days time, it's hard to know.
- At a major inflection point at the same time, so wary of headfakes
- No trading between 79.25 and 88.50 unless it's off the open
- A wait & see day - there's going to be good opportunity when this breaks, so waiting for that

Weekly Numbers
Range - 2377 -> 2390.75
Value - 2382.50 -> 2387
S1 - 2365.75, R1 - 2394.75

Daily Numbers
Range - 2381.75 -> 2388.75
Value - 2383 -> 2386.50
Globex 2381.25 -> 2386.25

Settlement – 2385.75

Today - 2379.25, 2388.50

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

Jigsaw-trading.png 

 
Posted by Peter Davies on May 03, 2017
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