Outlook 07/31

Context: With central bankers preparing for their summer vacations, Global markets are positive at the start of a week that ends on Friday with the U.S. NFP Non Farm Payrolls. Crude futures briefly rose above $50 overnight for the first time since May after OPEC said it would meet next week to discuss why some nations are falling behind on their pledge to cut production. Next meeting will take place on Aug. 7-8.

/ES Value: YVAH 2469 YPOC 2466.50 YVAL 2464

/ES Plan: Friday left a balanced profile. We're moving above Friday's range/value. Globex is bullish (GBT 2480), so we've 2 options:

A) If market holds above YVAH 2469, it is a clearly bullish signal, so try to be buyer and scale into the long side towards ONH and GBT 2480. If the market begins to trade within Friday's value area and volume increases at lows, it would be recommended to exit long positions.

B) If market opens above YVAH 2469 but then fails to go through ONH (One Tick Failure) and begins to trade back with volume at lows increasing, it's a signal of rejection, so try to be a seller towards YVAL 2464 and CLVN 2462. Internals should be neutral or negative.

Tips: On Thursday's session, /ES market showed a 'long liquidation', leaving a 'poor high' (PBT 2499). Long liquidation could add strengt to a bullish market because it removes potential sellers, old pit traders said that a market has to break before it can rally. Poor highs are often the result of excessively long inventory, and therefore take time to balance before continuing the prevailing trend to repair the imbalance.

Today's Economic Calendar

09:45 AM Chicago PMI
10:00 AM Pending Home Sales
10:30 AM Dallas Fed Manufacturing Survey
03:00 PM Farm Prices

Disclaimer: All information on this outlook is for educational purposes only and is not intended to provide financial advice. Full Disclaimer

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