BREAK OUT TARGETS ( a trading range) are calculated before the US Open. They can be calculated with any market, and an overnight 6E chart will be shared later in the post.
Today we had a pre-open BO+5 to the long side, and a BO +5 to the short side. A range bound day overall. Neither side could front a run, and the range plays became dominate. Most of the US market was a range reversal (LB to SB)
Tonight, I hope to clarify how I see and play the market.
GENERAL FOCUS
Today we had a pre-open BO+5 to the long side, and a BO +5 to the short side. A range bound day overall. Neither side could front a run, and the range plays became dominate. Most of the US market was a range reversal (LB to SB)
Tonight, I hope to clarify how I see and play the market.
GENERAL FOCUS
- A BO of the long is where bulls are expected to show strength, thus a run of +5 +10 and/or +15 will often be seen. A failure to run much beyond a limit usually spells a reversal.
- Between the strong bull and strong bear is a range of transition. Bull/bear plays are seen, but the belief is that a FBO or weak BO of LONG/SHORT (top and bottom line of range) means a range reversal is expected, and tends to run to the opposite side of the range.
- A BO short is where the bear is considered dominate and expected to run BO 5, 10, or 15+. A FBO has the same expectation as described in the long BO.
- The EMA and/or VWAP is expected to cross one of the calculated lines and often at the same junction will be current price action. When an average, range line, and PA collide a BO is expected. This may seem obvious, but remember, the range line is there first and acts as a guide to the market.
- A two bar engulf, often referred to as a two-bar doji or the MAXT, at (proximity) an average or range line is regarded as a reversal signal.
ES TODAY
Pre-open long to BO-5 came back into range and failed to break out just before the US Open. This is why the preference is for a global setting as opposed to a Rth chart. The range run was significant, and for 11 points with an exit at the FBO b4. It then took three bull pushes to break the middle range (EMA/VWAP). B18 area failure began another run to the lower range. Not looking good for bulls. Essentially we were moving slightly above/below b1. Also note b1 low was exactly at the mid range. Important information. Also important, a H&S developed with a neckline at the short BOT (1214). We had a BO of the H&S base and SB for a BO-5 run. BO-5 was holding so a range bound day appeared most likely. Neither bull nor bear could push much beyond a BO-5 level.
The reversal from 1213 ( 3 point risk) was expected to be 8 points. The actual was 7 and price came back to float around the lower range.
6E
Last evening I provided a friend some range points for CL and 6E. Here is the result.
PA entered at the lower range and continued to run bullish in to the Euro Zone Market.
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