Hurricane Irma

Context: Markets trade lower in the early going, tracking continuing tensions over North Korea and a new hurricane threatening to menace the U.S. coastline. European stocks followed Asia lower, and most commodities also are lower. In Europe, investors are also looking ahead to the European Central Bank's monetary policy meeting on Thursday.

/ES Value: YVAH 2463 YPOC 2455 YVAL 2446

/ES Plan: Yesterday closed leaving a bearish imbalance (PBT 2439) after testing CLVNs 2461 and 2453. Overnight inventory is balanced moving few ticks below YVAH 2463. LVN 2465 is still into play as 'line in the sand'. North Korea nuclear test was a news-driven event so Scene of Crime (SoC 2474) is still into play. We've 2 options:

A) If market moves below YVAH-LIS 2463-65 and remains below on subsequent tests, try to be a seller leaning on steps 2461-2463-2465 towards CLVNs 2453 and 2441. Internals should be neutral or negative.

B) If the market moves above YVAH-LIS 2463-65 and remains above on subsequent tests, try to be a buyer leaning on steps 2461-2463-2465 towards NK SoC 2474. Internals should be neutral or positive.

Tips: You can read the market auction process using the DOM. Look for large bids and offers that the market is testing and either lean on them (trade in the same direction) or wait for the market to break through them. Pay attention to the ranges trading as the inside bid and offer move up and down the ‘ladder’ and play reversals at range extremes or pullbacks after breakouts. Pay attention to the thickness of the bids vs offers, in general are there more buyers on the bid than sellers or vice versa. Do your best to stay focused for at least 1-2 hours. Once the market starts to grind with little volume trading, close your trading day.

Today's Economic Calendar

08:30 AM International Trade
08:55 AM Redbook Chain Store Sales
09:45 AM PMI Services Index
10:00 AM ISM Non-Manufacturing Index
02:00 PM Fed's Beige Book

Disclaimer: All information on this outlook is for educational purposes only and is not intended to provide financial advice.