End of day review 2-2-11 Wednesday

   So Es played out as expected today trading in a range from 1304-1298. There were a few good opps to trade today but other than that it was pretty dead. We only traded just less than 1 million contracts which is very light. Any way i was glad to get 3.5 points today. With ES in this new area of the market and putting in value all day along with the bullish weekly IB  its a good sign for the market to move higher. I would like to see ES test the previous value area at 1298 during RTH so i can get long for a swing trade and hold it for a few days as we make new highs. I may keep an eye on it tonight to see if we get down there and maybe put on  a trade for a few lots and hold on. We shall see...

  1st Trade: I took this trade because the market was in range mode and i was expecting a balanced session. After ES topped out at resistance level at 1304.25 I started looking for a place to get short. I waited for order flow to signal a short and i used the book to lean on an order to position myself in the book. What i saw in the book was offers chasing the market down after the bounce off of resistance so that was the green light for me to get short. Also VB was diverging. (see chart)

2nd Trade: I got long for a scalp trade off a trend line. I used the book to get into this one and watched for bids to firm up as price approached the trend line. When i saw the bids stick i got long in front of one and i only took 1 tick of heat. It took some time for the market to follow through. Price hit my target several times but didn't fill so I just took 1.5 and called it a day.

Pre Market Analysis 2-2-11 Wednesday

News: ADP Employment report @8:15AM, Challenger job cut report @ 7:30AM, MBA purchase applications@ 7:00AM, Nothing substantial after the open.

Daily chart notes: ES has broken out of the recent balance area of 1296-1267.50 and closed near the highs of the day making new highs on the year.

MP notes: ES had a big up day yesterday breaking the value established over the last few weeks. ES managed to close above the recent value area and within the value established on the day. With globex session trading in the same value area of yesterday. That gives us a bullish to neutral macro structure. We also have a bullish weekly IB so I'm expecting support to hold and looking for a move higher to search for more sellers. We could get another 16 point move to the upside which is half the weekly IB range.

Trade Plan:  Im expecting ES to balance for the day with no meaningful catalyst out today. We have a breaking of value type scenario with 1298 as the top of the previous value area. So i will be looking for a retest of this area for longs and also for a swing trade. For the swing trade i need to see ES build value here for 1 day then look for the retest to get long and hold for a few days. On the short side if ES forms a range i will look to sell the top and buy the bottom.