FRIDAY FUN DAY: RANGE BOUND ACTION 8/16/13

OK, a Friday with news still playing games with traders.  It was deemed a range bound day early, with trading carefully crafted.

ES

[09:25] <CM> ES today  expect range bound  look long pa at mid range and ema break  max runs expected today would be to BO-5  1650/1666    (link deleted)

[10:15] <CM> es holding at mb  off sb longs  in a channel as well  (link deleted)

While PA was holding at the MB it still seemed (perhaps optimistically) that it could return to the LB and break long, the gap in PA to the LB was telling another story.

[11:25] <CM> es alert   tl and mb bo test after b20 50cb failed  (1660 bar 22)    (link deleted)
[11:26] <CM> t1 56.25  t2 54.75

1650 BO-5 hits and PA bounces only to find another set of GAP signals at the MB; a lower high from the prior GAPS.  More selling and a narrow range for the day.

CL

CL had a different story to tell.  PA coming into the open was in a consolidating mode.  By bar 5 we have the breakout bar establishing a control bar.  The 50CB and the 50CB Trend Line become important guides to PA.

Plays are the same for any instrument: 1.)  50CB's that fail, look for a trend continuation; a break, look for the reversal. 2.)  For the 50CB TL, there is a bull/bear bias, and 3.) a break of these values look for prior 50CB targets.

We see the wedge developing after the BO run.  The top was 7.84, bottom 7.74 with 7.58 as a draw magnet.  A FBO of the 50CB followed by the second continuation move, which was seen as a max run.

[11:19] <CM> es bouncy ball up channel    CL final run at 108.10 area   downside 50cb 7.93  7.75 

A "Dick Tracy" pattern developing and the right side dropped very nicely.

When PA is breaking down, follow the same rules: follow the 50CB's and TL.  

End of the day,  PA did settled in the  7.75-7.80 target....