May 20th, 2013 E-mini Prep Work

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Coming into today there are several areas worth noting.

First off resistance: 415pm gap fil- 1663.75, Overnight High-1664.50 and Friday’s High- 1665.75

First midpoint Current overnight low- 1659.75, Low volume node from the multi day breakout 1660.25, daily pivot point 1660.75, Value area high- 1661.00

The overnight low is still being created at the moment and the action looks more like a short term topping formation. Leading me to believe that in all likelihood the market will want to test the volume point of control at 1656.00. However that midpoint is important for getting on board any lower high or playing support for the gap fill if the level holds pre-market.

The lower midpoint: Daily S1 Pivot- 1655.50, VPOC- 1656.00

This is a significant area likely to be tested and to bring in buyers if tested. Which will also double as a very important level for the support zone, failure to clear this area from below would indicate shorts are not taking the bait to cover and going back into the previous multiday range would be more likely.

Support: Low volume node 1652.25, Friday Low- 1652.50, Value area low- 1653.00

It is important to note again the lower midpoint is a crucial area for longs to clear, because there is still the decently sized unfilled gap below this zone that would act as a magnet if shorts don’t cover at the VPOC.

Here is the chart:


It is important to note the momentum required by the market to get down to the lower midpoint and support zone. Despite the overall uptrend and hitting new all time highs on Friday, such a move would require a lot of selling and should at the very least be treated as contra trend.