ES Weekly Plan | January 16-20, 2023

🟩 Daily: OTFU | Ends: 3965.75
🟩 Weekly: OTFU | Ends: 3897.25
🟨 Monthly: BALANCE | 4 Month | H: 4141 L: 3502

Weekly Extreme High: 4125
Weekly Extreme Low: 3910

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

---

The market has shifted from balance to imbalance. In my previous Weekly Plan, we discussed the potential for 3960 to act as a magnet if buyers were able to hold above 3913, which is the prior 4 week balance low. On Monday, the market opened with a true gap up, breaking out from the 3 week balance and quickly tested the 3960 level, where selling activity was immediately encountered. The session closed right at 3913.75. On Tuesday, we partially filled the highlighted fill section, but sellers had trouble gaining traction below 3913. The session ended very strong with a spike to the upside, and an excess low. For the rest of the week, buyers were in control with daily one time framing up, and we closed within the highlighted weekly resistance area of 4045-4005, where selling activity could be expected. Note how the 3960 HVN acted as support once it was breached.

For this week, the main focus will continue to be on that high volume node 3960, which is important for buyers to hold. Weekly is now one time framing up together with daily, indicating that buyers are in short-term control. Sellers main objective is to end the daily OTFU, and put it back to balance. Note how the last three daily lows are very close together, meaning we should have plenty of stops if sellers can manage to end daily OTFU. Also, note the weekly profile and the lack of excess to the upside.

The weekly level of interest is 4002. Holding above 4002 would target the previous Weekly Extreme High 4045. Break and hold above 4045 would target the resistance area from 4090 to the Weekly Extreme High 4125, where selling activity can be expected. Note how this resistance area coincides with the prior 4 week balance high. It is also noteworthy that the Monthly Extreme High for January is at 4125, major confluence.

Break and hold below 4002 would target the high volume node 3960, which is now a downside magnet. Break and hold below 3960 would target the support area from 3945 to the Weekly Extreme Low 3910, where buying activity can be expected. Note how this support area coincides with the 3 week balance high. Note the MA50 and the Monthly VWAP within the support area.

Overall, this directional move to the upside is not in any huge trouble as long as the support area holds (weekly breakout). Trouble for buyers kicks in with established acceptance below 3910.

Upside levels of interest: 4045 | 4090 | 4125 | 4160 | 4220
Downside levels of interest: 3960 | 3945 | 3910 | 3875 | 3847

---

Economic Calendar: January 16-20 | Central Time (GMT -6:00)

---

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.
Twitter: @smashelito | FAQ: smashelito.com