Your MUST-READ Morning Stock Futures Cheat Sheet: Bull trap or continuation?

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The Precise Take – Bull trap or continuation?

Big Picture Analysis:  Yesterday’s breakout from the consolidating wedge structure indeed got continuation and, overnight, the ES traded to 1210.00, marginally above its August 17th high.  Below, we’ve split the volume profile from the breakdown level of the last rally, and we can see the ES has now touched its MIDAS curve (anchored VWAP) that has contained price since the July 22nd high.  Though the indexes could trek higher in the coming days into Employment Situation Friday, we are on alert for the possibility of a bull trap at these levels.  We’re heading into a the news- heavy part of the week, with Consumer Confidence and FOMC minutes today, ADP Employment and Chicago PMI tomorrow, Jobless Claims and ISM Mfg Thursday, and Employment Situation Friday.  As always, bulls will need to buy the dips on any disappointing news and rally on good news.  Lack of leadership will encourage short sellers to seize on any apparent weakness.

Trading Today:   Below are marked the support and resistance areas.  The recent Jackson Hole event makes this afternoon’s FOMC Minutes from the prior meeting less relevant, but there could be some short term volatility as traders seize on anything that stands out.  Also, Consumer Confidence at 10:00 am could be a market mover if out of consensus.

Today’s  Scheduled News (all times EDT)

Major Market Movers
Consumer Confidence at 10:00 am
FOMC Minutes at 2:00 pm

Minor Market Movers
S&P Case Shiller HPI at 9:00 am

Tomorrow’s Scheduled News

Major Market Movers
ADP Employment at 8:15 am
Chicago PMI at 9:42 am

Minor Market Movers
Factory Orders at 10:00 am
EIA Petroleum Stats at 10:30 am

Click above images for larger charts.