The E-Mini S&P 400 futures contract has been trading within clear patterns of expansion and contraction lately, revolving between the two day after day in the last week of trading. The current pattern indicates we could see a major breakout opportunity to begin the day. Here’s why..
Inside Value Relationship
The E-Mini S&P 400 (MCH1) has developed an Inside Value relationship, as seen in the 15-minute chart below. This relationship occurs when the upcoming day’s value area forms inside the prior day’s value area, which indicates price is coiling ahead of a potential breakout move.
The MC has clearly formed this pattern, thereby indicating there could be fireworks to begin today’s session.
If price opens the day with an initiative spark, we could see a breakout/trending market the first two hours of the day, and potentially longer.
Look for price to either gap beyond yesterday’s price range, or for price to break through yesterday’s price range early in the session. A violation of this nature will indicate a push in the direction of the break, which could be quite fruitful.
The last time this relationship formed was four sessions ago (Feb 25)…and the MC rallied 16 points on the day – that’s $1,600 per contract traded. Not a bad!
Let’s see if we can get the same type of spark today!
Cheers!
Frank Ochoa
PivotBoss.com
Follow Frank on Twitter: http://twitter.com/PivotBoss
Nice call! I was all over it, and had a great day.;)