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S.P. mini's (ESH10) today in review

1/21/10

 7:55EST(p.m.)

ESH10:

In the event we immediately head up from current levels

Then 1114.25 to 1114.75 becomes a key resistance level

 7:40EST

ESH10:

I’m expecting to reach 1105.25 and 1105.75

As such there exists a high probability we bounce from those levels.

The bounce will clearly not reach new highs

And will be short lived in price and time duration

At this point in time I’m expecting the bounce to not exceed 1130.75

The bounce will be in 3 stages.

Up-Down-Up

The first stage of the bounce will terminate between 1119.50 to 1121.25

The key price level in determining how high the bounce reaches is the price action at 1111.50 to 1111.75, providing we reach 1105.25 to 1105.75 first

 The above projections will change if we reach 1112.75 before 1105.50

 

Short from 1146.50 (600 contracts)

Took profit at 1125.50 on 10% (60 contracts)

Currently short 540 contracts from 1146.50

I plan to take profit on 35% of my current short position at 1105.50

Leaving on 50% of the short position

In addition at the projected bounce level

I plan to hedge one to one

 

5:00EST

ESH10:

I’m expecting an immediate move down to 1107.25

Due to the large number of open contracts from today

(mentioned in the closing comments)

we could well trade below 1107.25

I believe majority of the stops are below 1100.00

In my estimate the Federal Reserve currently are long 1,002,736 contracts on the March contract, their average price is 1104.00.

 Regarding the chart

I’ve been extensively monitoring a large trader

Whom I believe is the Federal Reserve

From the March contract I have a trendline according to their intervention in the marketplace..(red line on the chart) their trendline is at 1103.50

 Due to the large amount of recent publicity

Regarding the possibility of FR buying up the ES market

I believed they would fade on any more intervention until the issue publicly goes to sleep.

 I believe they need to make a decision soon

What to do

To buy in order to prop up the market

Or to sit with their arms folded.. 

 That decision according to my estimate is the 1103.50 price region

 At 1107.25 to 1103.50

I plan to hedge my short position from 1146.50

The hedge will be 1 to 1

 

masterchetrading@gmail.com

 

 Closing Comments:

 ESH10:

 No Irregular C/T Pattern

 I’m surprised we made a new low on the close

I had figured we would reach 1111.75 no lower.

Due to the massive volume needed to push it down further.

This tells us Longs got squeezed on the close.

 I had it figured this way

We reach 1111.75 (no lower on the close)

And then in the after hours session

We break below 1110.75

Economically its more feasible

From the first low at 1111.50

And until the close we traded 1,872,870 contracts

Therefore you spend less money for a higher yield

Shorting Heavy the after hours session

Just from the first low at 1111.50

 Think how many stops are out there.

The first level of stops begins at 1108.75

 

The fact we clearly traded through 1114.25

The upper outer wall of the below pattern

Opens the correction door.

Clearly trading through 1106.50 confirms that the correction door is open

Trading below 1084.50 to 1088.50 clearly confirms that this is a correction

The correction will reach 975.00..

 

Intermediate term: (52 days or less)

Today is the 32nd day

RCT (from 12/4)

Neutral

Equalizer: 1088.50

Up Price target: 1166.25

Down Price Target: 1010.00

This pattern is a cycle completion pattern according to its physical dimensions

 

 1:37EST

ESH10:

We are developing an Irregular C/T

Which as I’ve mentioned

Are reversal patterns (80% of the time)

 if we make a new low after 2:00EST

we don’t have the Pattern..

if we don’t make a new low between 2:00EST and 8:00EST

then we have an Irregular C/T

 

If I don’t see a new low after 2:00EST

I’m considering taking profit on 35% which leaves 50% of my position on.

 

Regarding the chart

The large dashed and dotted  lines (turquoise and black)

Is the potential Irregular C/T

Although this potential Irregular C/T

I feel is of the 20% (don’t reverse)

Because we have a triple compression crossover at 1125.75 (Brown circle)

Triple compression crossovers are extremely rare..

This is first one I’ve ever seen

I’m assuming it’s three times stronger

 

But first we have to get through the dashed black line and the black line at 1119.00 and 1120.50

The black dashed line and the black line are the floating equalizers on the Large Triangle which originated at 1077.50 to 1096.50 on 11/12/2009

 

 

12:35EST

ESH10:

Regarding the Chart

This is the large triangle we spoke about two or three days ago

It’s the zoom shot and immediate term channels

Note we reached the lower channel  (1111.50) line exactly (time wise) as expected

The key is the green dashed line (Apex Vector Floating Equalizer)

This line determines if we are bearish or bullish

And in addition functions as key resistance on all bounces

This descending line will become profoundly important in the days to come.

 

11:57EST

ESH10:

 

We went through 1114.75

Which is upper outer wall of this pattern

Intermediate term: (52 days or less)

Today is the 32nd day

RCT (from 12/4)

Neutral

Equalizer: 1088.50

Up Price target: 1166.25

Down Price Target: 1010.00

This pattern is a cycle completion pattern according to its physical dimensions

 

Which means; we’re heading down to 1107.50 to 1107.75

Therefore 1106.50 (the upper outer wall of the below pattern becomes a key level to watch..

 

Intermediate term: (44 days or less)

Today is the 37th day

RCT (from 11/27)

Pointing Up

Equalizer: 1084.50

Up Price target: 1150.75

Down Price Target: 1018.00

 

This market reminds me so much of late July early August 1987

 

 

11:30EST

ESH10:

Most often powerful compression movements are in 23.25 points increments

As such this compression expansion began at 1138.50 therefore according to the norm 1115.25 is the termination point of the norm…

 

Rarely the compression movement expands either 11.75 points or 19.50 points more than the norm (23.25)

 

10:49EST

ESH10:

 

In terms of compression structure

Clearly below 1118.75 opens the door to 1082.00

On the charts it’s a key compression pivot point

 

Compression expanded rather than contract

Due to the heavy weight of the 12,858,828 contracts

 

In terms of compression (time/price/volume)

This last move down from 1134.50 was the most powerful down move

Since 1114.25 down to 1091.00 on 12/4/2009

Back to back days

This is this is strongest compression down move since 2008

 

 

We lost the large C/T on the last down move….

 

The dominant pattern right now

Immediate to short term

C/T Irregular

Equalizer: 1137.25

Up Price Target: 1161.25

Down Price Target: 1113.25

 

Then these 2 patterns are important to determine if this is a correction or a short lived decline

 

Intermediate term: (44 days or less)

Today is the 37th day

RCT (from 11/27)

Pointing Up

Equalizer: 1084.50

Up Price target: 1150.75

Down Price Target: 1018.00

 

Not reaching 1150.75 on a pattern pointing up

Is POTENTIALLY a  Short term correction

We will only know at 1114.25 and 1106.50

If this is a short term correction

 

 

Intermediate term: (52 days or less)

Today is the 32nd day

RCT (from 12/4)

Neutral

Equalizer: 1088.50

Up Price target: 1166.25

Down Price Target: 1010.00

This pattern is a cycle completion pattern according to it’s physical dimensions

 

 

Was there any news that came out to push it down so fast?????

 

10:13EST

ESH10:

 

We completed one immediate term C/T

It’s size is 7.75 points which is quite often a contraction number

Meaning the trading range contracts (gets smaller)

C/T

Neutral

Equalizer: 1134.75

Down Price Target: 1122.50

Up Price Target: 1146.25

 

The compression crossover I mentioned earlier appears to occur on or near the close.

 

We’re still developing a second pattern (larger)

 

10:05EST

ESH10:

 

Keep in mind this

Since the high at 1148.00

We’ve accumulated 12,858,828 contracts until yesterday

The Daily volume is clearly above the average

 

Only once clearly below 1113.00 do new longs cover their positions

New longs meaning from 1148.00

The initial squeeze down will be interesting because it will create old longs to take profit. Old longs (from 1088.00 to 1128.50)

 

Above 1150.75 kicks in short covering (new shorts)

 

 

9:43EST

ESH10:

In short

1135.00 is our key level

 

Below 1135.00

Support begins at 1130.25

Key (strong) support is at 1125.00 to 1125.75

Actually it begins at 1126.50

 

Above 1135.00

Resistance begins at 1140.75 to 1141.00

Strong resistance at 1144.75

1145.50 we have a key compression crossover between 12:30EST and 1:30EST

 

Below 1135.00

Support begins at 1130.25

Key (strong) support is at 1125.00 to 1125.75

Actually it begins at 1126.50

 

Today I’m expecting a sharp move down..

 

A clear trading break below 1126.50 opens the door to an larger down move than yesterday.

I was expecting a bounce at 1121.75, which now is highly doubtful

we reach 1113.25 without any bounces..

and possibly down to 1110.25

 

USD:

I forgot to mention

78.55 And 78.59 are the upper outer walls for 2 large short term patterns

Therefore 78.55 and 78.59 are currently key support levels

 

USD:

This long term pattern is currently the key

 

Long Term: (1048 days from 12/30/2008)

RCT

Equalizer: 84.01

Up Price Target: 99.73

Down Price Target: 68.29

 

The lower wall for this pattern is EXACTLY at 78.77

The last move up from 74.30 terminated exactly at 78.77

Terminating at exactly 78.77 tells us that this pattern is our master pattern and dominating all price movement.

 

Clearly trading above 78.77 opens the door for the move up to 99.73

 

Immediate term:

I never got filled at 76.56 (waited 9 days)

 

We have this immediate term pattern

Which is interesting

Pointing Down

Equalizer: 78.56

Down Price Target: 78.09

Down extension: Down to 77.80

Up Price Target: 79.02

We reach 79.00 and immediately pulled back to the upper wall outer of the pattern at 78.71. Trading below 78.71 takes us down to 78.56. The price action at 78.56 determines the next move.

 

The recent move up (77.58) is strictly based on short covering due to the Euro’s weakness concerning Greece. These concerns were clearly were exaggerated yesterday.  An immediate move down to 77.80 or lower is appropriate, although we may not  get this move down due to the ES price action and the fact that the USD is currently in a Bull Trend.

 

The Question is where to get back on the train.

We will clearly reach 99.73

I regret getting off the train at 78.70 (was long from 74.49)

I was 100% sure we would reach 76.56 to 76.61

Which we never did.