Homework for Tuesday 2008.12.15

15. December 2008
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ES - After a textbook Gann day yesterday, we are snug between two major Gann lines.  Since we are moving downward, I took the Gann measurements from the recent swing high on the daily chart.  The center line is 90°+45°=135° (874.25).  December seems to be an odd month for trading, so I have prepared multiple scenarios, just in case! 

  • Sell 874 (135° line), if prior to getting to 865.
    • Initial target 865
    • Summary: This played out right after the close.  We fell 45° (869) instead of a full 90° (865).  I should not have added this scenario to HW.
  • If we just go down from here, Buy 865, the intraday 90° level
    • Target 874 area
    • Next Target 889-893
    • Summary: Never got there before the "Bull Scenario" below.  So, off the table.  However, as mentioned above, we got a 45° break instead of a 90° break, then a rally.  The idea worked, but didn't get triggered.
  • Bear scenario: If we fail to rally off 865, and instead fall through it, look for support at:
    • Target 855-860, 180° area and yesterday's lows
    • Next Target 830-835, 270° line and the light gray line from our pitchfork
    • Summary: We rallied instead of breaking.  Levels may still prove important.
  • Bull scenario: If we rally early in the day (prior to the above failures), look to sell 889-893 area (90° line and yesterday's highs).
    • If we rally late in the day (especially, if off the 855 area), look for a target up to this same 889-893 area.

 

 

Homework

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