Morning Update for Tuesday, May 20th

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment:
Overnight Inventory Change:
Inside Day/Outside Day:
Location of price relative to market profile:
Notable overnight futures markets changes:
Up:
Down:


News for the day:

**NONE**

*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day: The S&P continued it's journey within the high volume composite range as the bears initially sold the markets only for the bulls to buy the dip and close prices near the highs of the day.  The market profile developed a "P" shaped formation, meaning that prices opened near the lows, were bought up to higher levels quickly before spending both time and volume at higher levels and, at the same time, increasing the value area.  The globex session has been neutral and trading inside of value, making the value area high and low (1882.75 & 1876.25, respectively) the key levels to watch for today. Intraday edge is neutral until there is a breakout of the zone and longterm edge is neutral to bullish. 

Stock of the Day:Google, Inc. (GOOGL)- Up 2% yesterday

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish 

Morning Update for Monday, May 19th

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment:Bullish
Overnight Inventory Change:Net short
Inside Day/Outside Day: Inside
Location of price relative to market profile: At value area high
Notable overnight futures markets changes:
Up: SI (Silver), NG (Nat Gas), PA (Palladium), PL (Platinum), GC (Gold), CL (Crude Oil)
Down:ZO (Oats), ZC (Corn), ZW (Wheat), CC (Cocoa)


News for the day:

**NONE**

*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day:  Just when the bulls made a run at continued new all-time highs, the bears sold the markets back into the high volume composite node.  As reviewed in the weekly video, the all-time highs were made on low volume, a sign that the market makers bought up the markets on a head fake, only to sell the contracts back into the zone.  Any activity inside of the 1840-1880 range has a higher probability of two-way trading and should be traded more cautiously until a breakout of the range. The profile has displayed parallel value areas on Thursday and Friday which means that the S&P had found a level of support after the gap down from Thursday. Intraday edge is neutral/bearish.

Stock of the Day: DirecTV (DTV)- Announcement of AT&T purchasing company

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish 

Morning Update for Tuesday, May 13th

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment: Bullish
Overnight Inventory Change: Net long
Inside Day/Outside Day: Outside
Location of price relative to market profile: Above value area
Notable overnight futures markets changes:
Up:SB (Sugar), ZL (Soybean Oil), ZM (Soybean Meal), ZS (Soybeans), CL (Crude Oil), NKD (Nikkei), ZC (Corn), HO (Heating Oil), KC (Coffee)
Down:ZO (Oats), CT (Cotton)


News for the day:

Retail Sales: 8:30a
Import & Export Prices: 8:30a
Business Inventories: 10:00a

*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day: It's up up and away once again as the S&P made all-time highs yesterday.  After a month of consolidation above the cloud, the markets finally built enough momentum to set a new record and rise through the high volume composite node.   Clearly, bear traders set their stop orders above the previous all-time high with the expectation for a bounce which triggered additional buying intraday yesterday as they were forced to cover their positions.  One point of note is the relationship between the closing price and the point of control (POC) for the day.  Prices closed right at the highs while the POC remained below at 1888, potentially creating a situation where traders could be long in the hole as prices migrate back to the POC. There has been some mild buying during the globex session to another high, making the open significant to watch if for some kind of liquidation. Longterm bias remains bullish.

Stock of the Day: Rackspace Hosting Inc. (RAX)- Earnings reported after the bell last night

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish 

Morning Update for Monday, May 12th

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment:Bullish
Overnight Inventory Change:Net long
Inside Day/Outside Day: Outside
Location of price relative to market profile: Above value area
Notable overnight futures markets changes:
Up:HG (Copper), SI (Silver), ZL (Soybean Oil), PA (Palladium), HO (Heating Oil), PL (Platinum), TF (Russell), GC (Gold), CL (Crude Oil)
Down:ZW (Wheat), NG (Nat Gas), ZC (Corn), OJ (Orange Juice)


News for the day:

Treasury Budget: 2:00p

*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day:The S&P continues to trade in a holding pattern within the context of the long term ascending trend channel.  There have been both bottoming tail and topping tail hammer candlesticks on the daily chart from last week with trading activity being conducted between the 1860-1880. Until there is clearance of the range, the higher probability is for more two way trading as both the bulls and bears look to build momentum for the next directional move.  The market has been trading to the buy side during the globex session.  The open will be key to see if the action continues above Friday's high of 1875, which is the level to watch for today.  Intraday bias is neutral until further notice.

Stock of the Day: Kandi Technologies (KNDI)- At 61.8% Fibonacci retracement 

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish 

Morning Update for Thursday, May 8th

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment: Bullish
Overnight Inventory Change:Neutral
Inside Day/Outside Day: Inside
Location of price relative to market profile: Above value area
Notable overnight futures markets changes:
Up:PA (Palladium), ZL (Soybean Oil), 6A (Aussie Dollar)
Down:KC (Coffee), CC (Cocoa)


News for the day:

Jobless Claims: 8:30a

*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day: The S&P's are currently trading in a "rubber band" style as prices have fluctuated within a well-defined trading range dating back to mid-April.  Each time the bears have attempted to sell the market and drive prices lower, the bulls step in, buy the dips, and lift the offers back into the 1860-1880 high volume zone.  Another signal of the horizontal price activity is the divergence of the major indexes.  Typically, the indexes trade in tandem as the market reacts to news and developments throughout the day.  However, the S&P and Dow were well in the green yesterday while the Nasdaq and Russell had sold off with the Russell selling below trendline support.  The ES has been neutral during the globex session and, until prices breakthrough the zone, the higher probability is for more two-sided trading and choppy price action. Intraday edge is neutral. 

Stock of the Day: Tesla Motors, Inc. (TSLA)- Earnings reported after the bell last night

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish 

Morning Update for Wednesday, May 7th

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment: Bearish
Overnight Inventory Change:Neutral
Inside Day/Outside Day: Inside
Location of price relative to market profile: Near value area low
Notable overnight futures markets changes:
Up:CL (Crude Oil), KC (Coffee)
Down:NKD (Nikkei), 6N (New Zealand Dollar), ZO (Oats)


News for the day:

Productivity & Costs- 8:30a
Petroleum Status Report- 10:30a

*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day: There is a tug of war currently taking place on the S&P with back and forth trading activity occurring with overlapping value areas dating back to the beginning of May.  As part of market profile theory, an emphasis is placed on where prices closed relative to the point of control (POC), the price where the most amount of volume had traded at from the previous day.  The market open will be key. Given yesterday's close near the lows and neutral overnight activity, the higher probability is for a migration higher to the POC as traders who were short in the hole would cover their positions.  However, if there is a liquidation break, any selling below Monday's low of 1860.5 would trigger additional bearish algorithmic trading programs to enter the market and setup for a trending day lower. 

Stock of the Day: First Solar, Inc. (FSLR)- Earnings reported yesterday

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish 

Morning Update for Tuesday, May 6th

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment: Neutral
Overnight Inventory Change: Neutral
Inside Day/Outside Day: Inside
Location of price relative to market profile: Near value area high
Notable overnight futures markets changes:
Up:NG (Nat Gas), 6N (New Zealand Dollar)
Down: ZM (Soybean Meal), ZS (Soybeans), ZC (Corn), ZW (Wheat), ZO (Oats)


News for the day:

International Trade: 8:30a

*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day: You can't fault the bears for trying.  Once again, sellers looked to push prices through the quadruple top that had been developing on the S&P daily chart and build bearish momentum after the jobs report from Friday.  The bulls continue to be persistent however in buying the dip and furthering the trend of the neutral value areas that have been developing between 1870-1880 for the past 5 trading days.  Any activity within the zone can be considered two-way trading since a significant amount of business had already been conducted at the levels. The premarket action has been neutral/long as the ES is approaching the previous day high of 1880, which is the key level to watch for today.  Intraday edge is neutral until there is a breakout of the high volume range.

Stock of the Day:DIRECTV (DTV)- Earnings to be reported today

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish 

Morning Update for Monday, May 5th

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment: Bearish
Overnight Inventory Change: Net short
Inside Day/Outside Day: Outside
Location of price relative to market profile: Below value area
Notable overnight futures markets changes:
Up:ZW (Wheat), ZO (Oats), GC (Gold), SI (Silver), CL(Crude Oil)
Down:TF (Russell Index)


News for the day:

ISM Non-Mfg Index: 10:00a

*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day: Many would argue that the relationship between the candlestick patterns and the volume, also known as volume spread analysis, is an important part of technical analysis.  Based on the price location of the S&P near the triple top combined with the increase in volume after Friday's jobs report, the setup is forming a false breakout pattern. When this occurs, the professional traders look to trap long traders into the market after positive news only to subsequently sell the markets in the following days.  We saw this happen when the markets opened on Friday and there has been continuation during the premarket with prices currently trading below Friday's range.  If buyers step in at the open, then the natural inflection point would be Friday's low of 1872.  If there is continued liquidation at the open, the next level of support is at 1865 but, after that, the chart is displaying room for a further selloff.  Intraday edge is bearish.

Stock of the Day: American International Group, Inc. (AIG)- Earnings to be reported before the bell

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish 

Cloud Trader Weekend Update 5.4.14

Morning Update for Friday, May 2nd

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment: Neutral
Overnight Inventory Change: Neutral
Inside Day/Outside Day:Inside
Location of price relative to market profile:Near value area high
Notable overnight futures markets changes:
Up: ZL (Soybean Oil), ZW (Wheat), NG (Nat Gas), SI (Silver), KC (Coffee), HG (Copper), CL (Crude Oil)
Down: ZO (Oats)



News for the day:

Employment Situation: 8:30a
Factory Orders: 10:00a


*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day:Today is the all-important employment report and is sure to provide the added volatility that index day traders and option traders crave.  The consensus is for the addition of 215,000 and will be closely monitored after the announcement of the number. Of course, the reaction to the news as reflected on the time and sales is more important than the news itself.  The daily chart pattern is more bullish and we have seen an increase in the value areas recently, but it is advisable to wait for the announcement before entering any positions.  Intraday edge is neutral.

Stock of the Day: Linked in (LNKD)- Earnings reported after the bell last night

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish