Identifying Daily Key Pivots for $ES using fibonacci retracement for CME_MINI:ES1! by kelmokca

Here are the pivots for the past 2 days for

ES

SP500.

Exhaustion and retracement
There are some exhaustion levels, levels where premium price is surpassed or held, and likely where discount is supported. The best entries tend to be at the exhaustion levels as there is limited downdraw. Once the market has established an exhaustion level, the price will retrace back at minimum 0.236 level, often 0.382. If the higher timeframe trend is still continuing, then it may come back to 0.0. If the exhaustion on the higher timeframe is completed, the retracement cycle tends to go back to 0.618 range, just past mean of the range.

Supplementary info

To gauge how far the price will retrace, identify any prior imbalances (fair value gaps FVGs, large liquidity blocks on the order books, opening gaps, and unusual rate of change in price). The market likely will return the price where there are such large imbalances. The market may move specifically to the fib level closest to these imbalances.

Discount and premium levels

Trace the fibonacci levels from 0.0 to 1.0 using the prior high and lows. Simply identify whether buyer come in a support level 0.618 fib level, and sell at the premium 0.786 fib level. If the price goes beyond the premium levels, 0.786 fibs, it is very likely to extend to a wider range (1.272 to 1.618) relative to the previous day. You could repeat this process for the smaller and higher, and when price pivots. The discount and premium windows offer a second chance to get in with good reward-to-risk ratio.

Best entries

By entering only at the key levels, your daily downdraw can be minimized to just a few points per day. Repeat this process daily for intraday trade and swings, and you will observe this pattern is very consistent for the large indices.

If you find this information useful, I do a daily session before the market open each day to map and provide the ideal trade plan based on this approach. We also review some liquidity levels, expected volatility relating to news and macroeconomic data.

Visit our website www.lothstrading.com to get more info and you can also join our free discord to exchange ideas and charts.