Climactic sell off seen before large rally on ES

Today was another very interesting day for the ES. Price rallied up during the overnight and London session. We then had the Unemployment claims report out at 08:30 EST and price fell very quickly into the open of the NYSE. Where it rallied a good distance very quickly before a 16 points sell off, culminating with a climactic selling, seen on the 20K volume chart.

We also had the largest 5 min volume of the day at the same time with a CCH bar closing near it's high. This was a very good reversal signal. After this, price rallied around 25 points in the last 3 hours before the NYSE close.

Yesterday, I said that I was expecting a rally up to the supply zone on the 100K vol chart and that is what occurred, but it did not go in the way I expected it to.  I did not expect price to break 1600, but it did and came very close (within 2 points) of the demand zone I identified a while back.

On the 20K vol and 5K tick chart the sell off looked very climactic and would have scared weak holders out of their long positions, with the Smart Money waiting to snap their hands off.

Tomorrow is the Non-Farm Payroll report and we can expect anything to happen. We could get a rally up to the 1640 supply zone on the 100K vol chart, or we can reverse back down to the 1590 - 1595 level.

I think that we will get a rally up to the 1640 supply zone before we resume the sell off.  However, I still think we will return to the 1590 level before we finally start the next leg of the up move.

Here are some charts: