Thinner Market

Outlook 02/07: Global financial markets were a lot calmer Wednesday. However, a sense of unease lingered following this week's turmoil, we'll see if today, the equity markets can regain sounder footing.

/ES Value: YVAH 2679 YPOC 2639 YVAL 2619

/ES Plan: Yesterday closed bullish (PBT 2750). Overnight is bimodal (LIS 2679) moving on the edge of Yesterday's value, so we've these options:

A) If market remains above YVAH 2679 with bullish internals, try to be a buyer leaning on 2679-2680 towards GAP 2689.75 ONH 2697.50 LVNs 2715-2733 and PBT 2750. 'Look above and fail' is a signal of weakness.

B) If market starts to move below YVAH 2679 with bearish internals, try to be a seller leaning on 2679-2678 towards ONL 2660.50 YPOC 2639 YVAL 2619 and edge 2586. 'Look below and fail' is a signal of strength.

Tips: Liquidity is still absent with the order book being below 100 at each level. We're still seeing the market sweep 8-10 levels in a minute, and that's not a normal behavior. If you can't trade using super-wide stops (20-30 pts), I strongly recommend to stay aside until the markets stabilize and recover a 'normal' tradable regime.

Today's Economic Calendar

10:30 EIA Petroleum Inventories
11:15 Fed's Evans Speech
01:00 PM 10-Year Note Auction
03:00 PM Consumer Credit

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

Questions? Just ask via email or twitter direct message.