Doubts Return

Outlook 02/20: A six-day rebound in world stocks began to splutter on Tuesday, as bond market borrowing costs regained traction and the dollar kicked firmly away from a three-year low. U.S. markets are now getting ready to reopen today, with stock futures in the red.

/ES Value: YVAH 2740 YPOC 2723.50 YVAL 2721

/ES Plan: Yesterday market closed bearish (PBT 2711) and overnight is bearish (GBT 2685) moving below Yesterdays value, so we've 2 options:

A) If market remains below YVAL-LVN 2721-20 with bearish internals, try to be a seller leaning on 2721-20 towards PBT 2711 ONL 2709 and LVN 2704. 'Look below and fail' is a signal of strength.

B) If market starts to move above YVAL-LVN 2720 with bullish internals, try to be a buyer leaning on 2720-21 towards GAP 2728.50 ONH 2735 and VPOC 2740. 'Look above and fail' is a signal of weakness.

Tips: Market does appear to be calming down but depth of market (DOM) is still thin, mostly below 200s contracts, still seeing sweeps 5-6 ticks at a time and very few prints as we move through prices. If you can't trade using wide stops, I recommend to stay aside until the markets stabilize and recover a 'normal' regime.

Today's Economic Calendar

1:00 PM 2-Year Note Auction

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

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