7/3: Daily Recap, Outlook, and Trading Plan
Recap
The past week has seen a strong bull flag pattern forming, with a breakout occurring late last week. This breakout led to a strong squeeze and a significant rally, demonstrating the power of simple technical analysis. The bull flag breakout is expected to target the 4560s, but the exact path to this target is unpredictable. We've also seen a continuation of the Thursday/Friday rally cycle, a characteristic of bull markets.
The Markets Overnight
🌏 Asia: Up strongly
🌍 Europe: Mixed
🌎 US Index Futures: Near unchanged
🛢 Crude Oil: Up
💵 Dollar: Up slightly
🧐 Yields: Mixed
🔮 Crypto: Up a bit
World Headline
Key Structures
The bull flag pattern, which extends from June highs to lows, is a key structure to watch. It broke out at around 4420 and the rally that followed is what a bull flag breakout looks like. Another structure to watch is the 4374 level, which is the back-test of the green channel structure connecting the February and December highs. The large rising uptrend channel in white, connecting the March and May lows, is another important structure. The main breakout level from June 1st and 2nd is also crucial.
Support Levels
The major support levels are at 4485, 4463, 4445, 4423, 4411-13, 4393, 4374, 4357, 4351, and 4333.
Resistance Levels
The major resistance levels are at 4502, 4527, 4551, 4558, 4572-78, 4595, and 4620-25.
Trading Plan
Given the recent breakout and upcoming holiday sessions, it's time to lay back and let the price set up again. The focus is on reacting rather than predicting. The bull case suggests that if bulls can hold 4480-85 or recover it quickly, a direct trajectory higher could be in play. The bear case, while a long way off, suggests that a fail of 4460 on Wednesday could provoke a good short setup.
Wrap Up
We remain in a consolidating market to setup a move. ES tried to breakout a bull flag yesterday and the loose lean is that as long as 4420 or 4400-05 holds, we can push to 4445 and then 4460. 4372 remains the must hold final support and below there look for shorts.
Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
The past week has seen a strong bull flag pattern forming, with a breakout occurring late last week. This breakout led to a strong squeeze and a significant rally, demonstrating the power of simple technical analysis. The bull flag breakout is expected to target the 4560s, but the exact path to this target is unpredictable. We've also seen a continuation of the Thursday/Friday rally cycle, a characteristic of bull markets.
The Markets Overnight
🌏 Asia: Up strongly
🌍 Europe: Mixed
🌎 US Index Futures: Near unchanged
🛢 Crude Oil: Up
💵 Dollar: Up slightly
🧐 Yields: Mixed
🔮 Crypto: Up a bit
World Headline
- Saudi Arabia vows to maintain production cuts ahead of Wednesday’s OPEC meeting.
- Chinese manufacturing data continues to decline but reports stronger than expectations.
Key Structures
The bull flag pattern, which extends from June highs to lows, is a key structure to watch. It broke out at around 4420 and the rally that followed is what a bull flag breakout looks like. Another structure to watch is the 4374 level, which is the back-test of the green channel structure connecting the February and December highs. The large rising uptrend channel in white, connecting the March and May lows, is another important structure. The main breakout level from June 1st and 2nd is also crucial.
Support Levels
The major support levels are at 4485, 4463, 4445, 4423, 4411-13, 4393, 4374, 4357, 4351, and 4333.
Resistance Levels
The major resistance levels are at 4502, 4527, 4551, 4558, 4572-78, 4595, and 4620-25.
Trading Plan
Given the recent breakout and upcoming holiday sessions, it's time to lay back and let the price set up again. The focus is on reacting rather than predicting. The bull case suggests that if bulls can hold 4480-85 or recover it quickly, a direct trajectory higher could be in play. The bear case, while a long way off, suggests that a fail of 4460 on Wednesday could provoke a good short setup.
Wrap Up
We remain in a consolidating market to setup a move. ES tried to breakout a bull flag yesterday and the loose lean is that as long as 4420 or 4400-05 holds, we can push to 4445 and then 4460. 4372 remains the must hold final support and below there look for shorts.
Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
