Market Analysis - 02.11.2020
OVERALL MARKET
Futures markets are most up higher from the overnight open. Stronger financial data coupled with Beijing's call for companies to resume production has buoyed financial markets. We continue to await an announcement from OPEC+ regarding any changes to production. Earnings season is still in progress with $IHG, $MDT, $TIVO and $WMT reporting today.
CRUDE OIL
$CL is currently trading above yesterday's value area. This range extension to the upside is strongly correlated with a more active day. If support holds at 50.31, look to 50.74 as a target for today. $CL GEX levels remain between 50-55 per contract through the end of this week.
Overall market profile is still trending downward with the past few days in balance. Currently, the high volume node is centered around 50.47. The upper limits of the node reach 50.52 while the lower area drops to 50.42. If we break below this node, downside target of the next HVN at 50.32 then 50.11 the most likely next level of support. If we move above resistance, look to 50.66 and then 50.74 as the next two levels of resistance.
S&P 500
$ES is has broken above yesterday's range and is currently trading in a new range between 3355 and 3365. This is a very bullish signal, showing that other timeframe buyers are strongly in control. If we hold support of this range following the open, look for a large move to the upside. $ES GEX levels continue to predict the market remaining between 3300 and 3400 in the near term.
Short term momentum has turned back upward and longer term momentum remains positive. Current high volume node centered around 3360 with the upper end at 3363.25 and the lower at 3358.75. If we drop below this area, look for support at 3355.25 and then 3350. If we push above the node, next resistance level would be 3365 and then 3375.
OUTLOOK
$ES currently had strong conviction during the overnight session and has now settled in a new value area. Continue to monitor for any range extensions above 3365 as that will confirm that buyers remain in control. $CL has recently shown some buying pressure indicative of a search for new value. Both markets have shown a material correlation with a likely upside move today. Watch for range extension, tails and TPO count to confirm which party is in control.
As always, stay on your toes and watch for any news catalysts that could cause a change in bias. Control your emotions so they don't control you.