ES Weekly Plan | June 5-9, 2023
Below are my expectations for the week ahead.
🟩 Daily: OTFU | Ends: 4249
🟩 Weekly: OTFU | Ends: 4174
🟩 Monthly: OTFU | Ends: 4062.25
Weekly Extreme High: 4375
Weekly Extreme Low: 4200
As usual, a detailed daily plan will be published tomorrow.
The previous week, although shortened, was very eventful. On Tuesday, the buyers attempted to break out of the 3-week balance area; however, the buyers failed to sustain the move and the session closed back within the weekly balance range. On Wednesday, the sellers managed to bring the daily back to balance, cleaning up the poor structure from the 5/26 session in the process. Wednesday’s weakness was all sellers got as the market witnessed two consecutive trend days to the upside, effectively breaking out of the 3-week balance. This breakout subsequently led to a test of the prior weekly resistance area.
For this week, the main focus will be on whether the buyers can sustain the directional move away from the prior 3-week balance area. The market is one-time framing up across all time frames, indicating that buyers are in full control of the auction. The primary objective for sellers is to put an end to the daily one-time framing up, and until that occurs, maintaining a bearish stance becomes quite challenging. The most bearish outcome would be established acceptance back within the prior 3-week balance area, indicating a failed breakout. In the event of an upside continuation, the primary target for buyers is the August high at 4327.50. It worth noting that the short-term value (5-day VPOC) is nearly 100 handles lower than Friday’s settlement. Having that said, the buyers aim to spend time and volume within Friday’s range to migrate the short-term value higher. This would suggest that the upward auction is not yet complete.
The weekly level of interest is 4275, which represents the upper end of Friday’s lower distribution. Holding above 4275, indicating a continuation of this imbalance, would target the prior Weekly Extreme High of 4320 as well as the August High at 4327.50. Break and hold above 4327.50 would target the resistance area from 4340 to the Weekly Extreme High 4375, where selling activity can be expected. 4340 serves as the 100% range extension from the prior 3-week balance area. Take note of the Monthly Extreme High (June) at 4365, as it adds an additional layer of confluence to the resistance area.
Break and hold below 4275, which puts Friday’s double distribution trend day into question, would target the unfilled daily gap at 4239.75. Break and hold below 4239.75 would target the support area from 4235 to the Weekly Extreme Low 4200, where buying activity can be expected. This support area is highly significant, as the upper end of it essentially is the breakout point for this imbalance. As I’ve mentioned the recent Weekly Plans, for any significant change to occur in the bigger picture, the sellers would need to break and hold below the Weekly Extreme Low, with a weekly close below it being preferred.
🟩 Upside: 4320 | 4327 | 4340 | 4375 | 4420 | 4460
🟥 Downside: 4240 | 4235 | 4200 | 4140 | 4130
Economic Calendar
Disclaimer: Futures and options trading involves a high level of risk, with the potential for substantial losses. The information provided in this newsletter is for informational purposes only and is not intended to be a trade recommendation. It is the responsibility of the reader to make their own investment decisions and they should seek the advice of a qualified securities professional before making any investments. The owners/authors of this newsletter are not certified as registered financial professionals or investment advisers.
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