Short Term Trading Week Starting: 04 Feb, page-123

US Pre-Market

Good evening,

So much for the previous divergence between the XAO and SPX! Some important levels were taken with three big green exclamation points this week. Europe is weak with the DAX back below that trend line and Japan was also weaker. Speculative chatter in response to the stream of weaker European data focuses whether the ECB will take a cue from the Fed and RBA soon enough. That might be good news for gold vs multiple currencies. US treasuries are trading higher with an hour to go to the cash equity session.

ES futures are down and trading very net short as European indices flounder. Price is currently trading within the center distribution area from Monday's scattered profile mentioned in Tuesday's pre market update that followed the first leg of your big rally. Price is around 2712. There is a vpoc at 2703 that provides some stronger support as well as the support levels mentioned earlier in the week.

Incoming
On Thursday we have Initial and Continuing Claims at 08:30 ET followed by Natural Gas Inventories at 10:30 ET. There is a $19B 30-year bond auction at 13:00 ET. There is also the Consumer Credit report for December at 15:00 ET. We have three Fed speakers today: The Fed’s Vice Chair and Dallas Fed president near the open, and the voting St Louis Fed president after the close. Buyer’s exhaustion might be exploited a bit but shorts will likely be cautious.