ES Weekly Plan | March 27-31, 2023

My expectations for the week ahead.

🟥 Daily: OTFD | Ends: 4003.50
🟨 Weekly: BALANCE | 3 Week | H: 4082.50 L: 3840.75
🟨 Monthly: BALANCE | 3 Month | H: 4208.50 L: 3814.50

Weekly Extreme High: 4130
Weekly Extreme Low: 3875

As usual, a detailed daily plan will be published tomorrow.

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To put it mildly, last week was quite volatile. On Monday, the market had its second consecutive inside day, indicating a need for more market-generated information. The big question was whether there would be a directional move before the FOMC meeting on Wednesday. The participants of Tuesday’s session had no interest in waiting any further as the market opened on a very large gap to the upside, marking the end of the weekly one-time framing down. As usual, the market underwent volatility during Wednesday’s FOMC, and the session resulted in an outside day down following a nasty rejection from the resistance area of 4090-4045, highlighted in the previous weekly plan.

Wednesday’s rejection from prior weekly resistance area.

Thursday's session serves as an example of the market's tendency to punish traders who act emotionally. Following Wednesday's emotional session, the absence of an immediate downside follow-through led to a vicious squeeze at the beginning of Thursday's session. However, once the short-covering rally was over, sellers regained control since the rally failed to attract new buying interest. The sellers managed to make a lower low on Friday, but once again, the lack of initiative activity attracted responsive activity, leading to a rally and a close back within the upper distribution of previous week.

For this week, the main focus will to be on whether buyers can establish acceptance within previous week’s upper distribution, which would negate previous week’s weakness. Despite a strong close on Friday, the daily is one time framing down, and buyers main objective is to put an end to that by breaching Friday’s high of 4003.50. The weekly has return to a 3-week balance after the early strength at the start of the week. The monthly remains in a 3-month balance, and we are currently trading right in the middle of it. Navigate day by day.

The weekly level of interest is 3990, which is the low volume node (LVN) that separates previous week’s double distribution on the weekly profile. Holding above 3990 would target 4040, which was a heavy resistance area the previous week. Break and hold above 4040 would target the resistance area from 4090 to the Weekly Extreme High 4130, where selling activity can be expected. Note how this resistance area coincides with the high volume area from the prior 3-week balance in February, where a monthly and weekly NVPOC are located.

Break and hold below 3990 would target 3950, which is previous week’s value support and the VPOC of the week before. Note the MA200 in close connection. Break and hold below 3950 would target the support area from 3915 to the Weekly Extreme Low 3875, where buying activity can be expected. Note how this support area coincides with two prior weekly value supports, as well as the yearly ON and RTH opening price.

🟩 Upside: 4040 | 4090 | 4130 | 4165 | 4220 | 4255
🟥 Downside: 3950 | 3915 | 3875 | 3847 | 3800 | 3755

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Economic Calendar

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