Day Trading & Forex Forum

arturo1

DAILY TRADING ADVISORY 14-October-2008


Markets post historic gains as governments “show the money” on their rescue plans. Morgan Stanley soars after Mitsubishi UFJ buys 21% for $9 billion. President Bush will announce an expanded bank bailout details.


ECONOMIC DATA

None

YESTERDAY’S MARKETS

U.S. stock indexes had their biggest one day jump ever. In a sky rocket session markets changed their short term sentiment. The E-mini SP opened well above Friday’s settlement starting the session at 942.00 and pulled back to 934.00. The short lived pullback posted the daily intraday lows as markets started to move higher showing a strong bullish pattern. The SP pushed up to 955.00 from where another orderly pullback tested the 948.00 level. As markets continue to move higher on a broad based rally, the SP moved up to 968.00 where a decent setback resulted in a move down to 954.00 where buyers stepped in strongly driving the index all the way up to the previous high that once it get broken, markets rallied on a parabolic move reaching their highest levels into the end of the session. On this “never seen” rally, the SP gained 125.75 points and settled at 1016.75, the Nasdaq which outperformed the SP signaling further upside momentum 176.00 points closing the session at 1458.50 and the Russell gained 50.60 points and settled at 571.70. The Dow jumped more than 14% after posting a gain of 1171 points, it ended the day at 9447.


MARKET COMMENTARY AND OUTLOOK

Yesterday I wrote:” At some moment, when the selling dries, and those who survived and still own huge capitals appear with their huge buying orders the current trend will get reversed. Last week huge sell off probably has already exhausted the selling pressure, at least on the short term, and Friday’s huge tail on the candlestick chart style, signals strong support at the recent lows, so we could expect that the markets will try to move higher. Another bullish condition for this week is de October option expiration that could help to push the markets higher, even above the 1000.00 mark on the SP. There are some important levels on the SP500 index (cash) that should offer very strong support, 823.00, 789.00 and 766.00 add some points plus the slippage and figure the futures contract near one of those levels. Even with the late rally seen on Friday that signals strong buying support at the recent lows, and even with a 2-3 days rally or consolidation, I think Friday’s low will get tested once more and maybe exceeded, if that happens, and the Dow test the 7700 area and gets back above 8050, probably it’s a buy, however the extreme volatility makes difficult to choose a good entry point and almost impossible do define a stop price. After Friday’s huge initial sell off and the high volumes that signal that sellers may be done, the index should rally during today’s trading session, actually at the time that I am writing my report, markets are trading sharply higher. This early rally could get reversed testing Friday’s settlement or lower and then rally back to close on positive territory, if that happens, then the next two to three day’s could finally offer some type of consolidation, and then, the indexes could fall to test the lows, or as a consequence of this last strong downward move continue to trade higher for another week before the rally gets into troubles.”

Yesterday’s record rally after last week huge sell off seems to have posted the low that we were looking for, and the indexes should continue with their near short term upside momentum at least for the next sessions. Many times I have write about the relative lack of importance in isolated moves, and with this I make reference to they key follow through continuation patterns after an important move. That means that yesterday’s huge relief rally will have to continue during the next few days in order to assume that the low is solid. This is the most probable scenario, the markets capitulated, the selling pressure got exhaust and the last shorts were trapped after yesterday’s opening gap. I can assume that for Friday’s bottom to be perfect, the indexes should move lower to test those lows by reaching them, posting a marginal new low or placing a higher low on the daily charts, but yesterday’s move seem to have legs to move higher until the last short gets squeezed and only then place the indexes in troubles. This means that buying the pullbacks should be the way to go, and if I am write, once the SP closes two consecutive sessions above 1013.00 (the first close above that area was yesterday), it should be able to reach at least the 1063.00 level, if that area do not hold an extremely overdone bear rally, then we could see the 1112.00 level before this move is over. The magnitude of last week downward move makes possible that this rally will hold into the end of next week, and this coming Friday in which there is the October option expiration should make add fuel to this huge upside move.

Yesterday’s rally went with relatively light volume; this can be an arguments for bears that there was not institutional participation, but huge amounts of money are just sitting on the sidelines and ready to join the market once the indexes show some follow through. If my short term bullish bias is wrong, the worst case is to see a consolidation of yesterday’s move, but if the markets close lower today and do not recover for tomorrows session, this huge rally could be a great selling opportunity.

For today’s trading session, volatility and wide wild swings should continue to be present, in these cases our tight stop loss orders do not work so well, but I will try to be a buyer on the pullbacks as my work calls for an extension of yesterday’s upside move. Market psychology tell us that players tend to exaggerate in their pessimism or optimism, and if the sentiment has changed and the upside momentum is back, don’t be surprise to see a test of the 10000 level on the Dow. Don’t expect to see another trend session, but the general bias should be to the upside.



TODAY’S SESSION

There is resistance at 1026.00-1028.00 on the SP, 1473.00-1475.00 on the Nasdaq and 578.50-579.80 on the Russell. Those levels are pivotal and if yesterday’s incredible rally is due to continue, the futures indexes should be able to trade higher and reach 1037.00-1038.50 on the SP, 1488.00-1490.50 on the Nasdaq and 585.70-586.30 on the Russell. If the markets managed to break higher, expect additional short covering that pushes the indexes up to 1047.00-1049.00 on the SP, 1503.00-1505.00 on the Nasdaq and 592.10-593.50 on the Russell. On the Globex session, the E-mini SP has already reached 1050 and the move was strongly rejected at that level, so an early test of the nightly highs should offer a good short entry, but don’t overstay your welcome as the trend has turned to the upside.

There is huge support at 1006.00-1004.00 on the SP, 1428.00-1426.00 on the Nasdaq and 562.40-561.10 on the Russell. An early pullback to those levels should be a great buying opportunity, however, if the markets break lower, it could be an indication that yesterday’s move was overdone and the indexes are ready for a two days of consolidation before another run to the highs, if that happen, look for additional support at 997.00-995.25 on the SP, 1413.00-1410.50 on the Nasdaq and 557.50-556.30 on the Russell. Those MUST hold for the indexes to maintain their strong upside pattern, if the markets fail there expect a test of 986.00-984.00 on the SP, 1378.00-1376.00 on the Nasdaq and 543.70-542.00 on the Russell. If the SP can not rally from that area and the 981.25 pivot level gets violated, yesterday’s rally could be in jeopardy. GOOD LUCK.



TODAY’S SUPPORT, PIVOT AND RESISTANCE LEVELS
S&P NASDAQ RUSSELL
Resistance 4 1055.00-1056.50 1515.50-1518.00 599.20-600.50
Resistance 3 1047.00-1049.00 1503.00-1505.00 592.10-593.50
Resistance 2 1037.00-1038.50 1488.00-1490.50 585.70-586.30
Resistance 1 1026.00-1028.00 1473.00-1475.00 578.50-579.80
PIVOT 981.25 1405.00 558.10
Support 1 1006.00-1004.00 1428.00-1426.00 562.40-561.10
Support 2 997.00-995.25 1413.00-1410.50 557.50-556.30
Support 3 986.00-984.00 1378.00-1376.00 543.70-542.00
Support 4 961.00-958.50 1366.00-1364.00 525.80-524.70


S&P NASDAQ RUSSELL
FIBONACCI FIBONACCI FIBONACCI
1192.65 1721.62 659.32
1167.10 1683.38 647.28
1125.75 1621.50 627.80
1084.40 1559.62 608.32
1058.85 1521.38 596.28
1017.50 1459.50 576.80
976.15 1397.62 557.32
963.38 1378.50 551.30
950.60 1359.38 545.28
909.25 1297.50 525.80
867.90 1235.62 506.32
842.35 1197.38 494.28
801.00 1135.50 474.80
759.65 1073.62 455.32
734.10 1035.38 443.28



DAILY PROJECTIONS S&P NASDAQ RUSSELL
AS DAILY HIGH 1071.25 1540.00 599.80
AS DAILY LOW 963.00 1378.00 548.80





Futures and options trading have large potential rewards, but also LARGE POTENTIAL RISK. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to buy or sell futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed in this document. The past performance of any trading system or methodology is not necessarily indicative of futures results.
DAY TRADING INVOLVES HIGH RISK AND YOU CAN LOSE A LOT OF MONEY.
Every effort has been made to accurately represent all of our products and it's potential. As with any business there is a risk of loss of capital and there is no guarantee that you will earn any money. The financial markets are risky .Investing is risky. The foregoing has been prepared only and solely for informational purposes and is not a solicitation or an offer to buy or sell any security, option or futures contract. Opinion is based on historical research but there is not guarantee that futures results will be profitable. We are not advocating or recommending trading futures and our services, notes and entry and exit prices to the markets only reflects our opinion an a manner how markets can be traded. We mention many indexes like the S&P, NASDAQ, Russell, Dow Jones as T-Bonds only because they are the most known and liquid markets, and not because we recommend in any way to be traded.
You can lose more than your initial investment.
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Copyright © by theminitrade.com

arturo1

DAILY TRADING ADVISORY 20-January-2009

U.S. stocks advance as government injected $20 billion into Bank of America and guaranteed losses on over $400 billion in assets of both Bank of America and Citigroup. Citigroup will split after posting $8.29 billion loss dot fourth quarter. BAC has first loss in 17 years. Preliminary Merrill Lynch results indicate a mammoth size fourth-quarter loss of $15.31 billion. CPI lower by .7%, year to year inflation is the lowest in 54 years, Industrial production minus 2%

WEEKLY PIVOTS FOR WEEK ENDING 23- January-2008

R3 921.00
R2 888.50
R1 868.00
PP 849.75
S1 835.00
S2 812.00
S3 794.25

ECONOMIC DATA
None

WEEKLY RECAP
A rough week for the U.S. equity markets as each of the indexes ended this period with losses. Monday’s session started on a quite note but fears about corporate earnings and weakness in the financials dominated the session, USB losing $7.2 billion in the fourth quarter and Citigroup splitting giving control of its brokerage to Morgan Stanley pushed the markets down, Citigroup shares fell more than 20% despite the expected earnings of the selling of some of its divisions. After the initial stability markets traded down for most of the session, the SP settled at 868.00 losing 17.50 points, the Nasdaq lost 15.50 points ending the session at 1206.00 and the Russell ended lower by 9.80 points at 466.80. The Dow lost 125 points closing the day at 8473. Tuesday was a consolidating session as markets fluctuated after a string of losing sessions. Alcoa reported a loss of $1.9 billion and Bernanke came with bearish commentaries about the economy saying that the stimulus plan won't be enough and more guarantees and additional asset buying may be done in the near future in order to stabilize the bank sector. Commodities prices including grains continue to collapse on lower demand and analyst expectations that the economy will continue to shrink during the year. In the corporate area, GE fell on Barclay’s profit outlook. For the day, the SP ended almost unchanged at 868.50, the Nasdaq lost two points closing the session at 1204.00 and the Russell closed up 5.70 points at472.50. The Dow lost 25 points closing at 8448. Big losses for Wednesday’s session as bad news were the tone of the day. Deutsche Bank $6.3 billion loss, worries about Citigroup after it gave control of its brokerage to Morgan Stanley which predicted it will have to raise as much as $30 billion and cut its dividend in half and that the bank's profit is likely to fall "sharply" this year and won't recover until 2011 and Retail Sales much worst than expected, minus 2.7% resulted in a strong negative session. The Fed’s Beige Book indicates a weakening economy in all the sectors and regions. Nortel Networks filed for bankruptcy as corporations continued to reflect the worst recession since the big depression. Markets ended sharply lower with the SP losing 28.75 points and finishing the day at 839.75, the Nasdaq ended lower by 38.50 points at 1165.50 and the Russell lost 20.10 points closing the session at 452.40. The Dow lost 248 points closing the day at 8200. Thursday’s session was highly volatile as the indexes traded at levels not seen since the beginning of last December, the day started with the news that Steve Jobs is suffering from health problems, also the ECB lowered rates by half point trying to prevent a recession. Initial Claims was up by 54K at 524K and continuing claims at4.5 million, PPI down by 1.9% and NY Empire State Index at 22.00 indicating weakness. JP Morgan post small profit and Bank of America will received another $20 billion to support Merrill’s deal. At the end of the session markets managed to come back leaving many shorts trapped near the lows but failing to show good volumes during the late rally. The SP ended the session with a half point loss at 839.25, the Nasdaq added 11.75 points and settled at 1177.25 and the Russell gained 7.50 points closing the session at 459.90. The Dow managed to close up by 12 points at 8212. Friday’s session was dominated by the January option expiration, the reported CPI was in line, minus .7%, year to year lowest in 54 years. Industrial Production continued to plunge; another 2% for December and Intel reported a 90% drop in fourth quarter earnings while many other companies issued sales and earnings warnings. However, markets ended higher in front of Monday's Martin Luther King holiday and next Tuesday's Obama's period inauguration, the SP ended higher by 9.25 points closing the session at 848.50, the Nasdaq added 19.75 points and settled at 1197.00 and the Russell added3.70 points ending the day at 463.60. The Dow ended up by 68 points at 8281.



FRIDAY’S MARKETS
After trading sharply higher during the Globex session, the E-mini SP started the day at 855.00 from where it backed off to 850.00 just to bounce back to 855.00 and trade sideways inside the opening range. The failure to break above the early highs resulted in a pullback to 847.50 where the index held. After a bounce to the 852.50 area, the SP moved lower reaching almost updated 844.50 downside objective from where it resumed the rally pushing upwards to 852.00 but failing once more to break higher. Once more, the index sold off to the daily lows where the market continued to hold. The SP then bounced a few points but gets sold to new intraday lows at 842.00 from where another bounce reached 846.25. Another pullback resulted in a new low that tested 837.75, bounced to 842.00 and pushed to a new low at 834.50. As the selling pressure continued to increase, the SP moved all the way down to 826.25 where the sell off finally ended. The SP rallied all the way up to 836.00, pulled back to the strong support area at 830.00 and continued higher to 840.00 where the rally stall posting a small double top that once it get broken gave the markets the necessary upside momentum to push higher reaching the early support and now resistance 845.00 area where the short covering rally lost its momentum. The SP pulled back to 837.00, bounced to 844.00 and once more backed off a few points just to bounce to another failed breakout attempt. Another breakout attempt reached pushed higher and reached 850.50, backed off to 845.00 and rallied to 851.50 from where the index fell back to 843.50, bounced a few points and sold off a few points but inched higher into the close. For the day, the SP ended higher by 9.25 points closing the session at 848.50, the Nasdaq added 19.75 points and settled at 1197.00 and the Russell added3.70 points ending the day at 463.60. The Dow ended up by 68 points at 8281.
MONDAY’S MARKETS
Martin Luther King shortened Globex session, showed a nightly rally that reached 865.75 on strong short covering following Friday’s positive session. The market opened with a gap and rallied to its highs, just to fall and trade for most of the night between 855.00 and 858.00, but after a couple of hours, the SP fell strong reaching 840.25. After bouncing to the 843.00 level, the index fell to a new low at 837.25, another failed bounce resulted in another push to new lows, the SP tested 834.50. After a series of higher lows the SP bounced to 840.50 but the overall weakness in the Globex session obviously couldn’t find any reason for a short covering rally. The SP settled at 840.00 for Monday’s Globex session.


MARKET COMMENTARY AND OUTLOOK
Last Friday I wrote:” Yesterday’s early sell off certainly exhausted the downtrend move leaving many late shorts trapped at levels well below the settlements, I clearly indicated that it was too late to take a short position and stick to it. This last downside move was done with better volumes and probably, the key reversal correction seen from yesterday’s lows has more room to go. Of curse, we can not call for a low until this rally exceeds three to five days, or push prices above the 888.00-892.00 areas on the SP and 8600-8800 on the Dow. So the scenario for these coming days is a countertrend rally that fails after three days or a strong move that makes all the way up to the last highs, and then probably fail as this bear campaign has not ended yet. Yesterday I wrote that the markets are trading in a wide range, obviously, they were broken during yesterday’s session, but the close was positive, and at least for today’s session and next week events, markets should be able to hold. The daily charts show that the markets posted a bullish reversal and if they can continue to move higher we could see a continuation pattern that could easily spark a big rally back to 868.50 during the next two sessions. I personally don’t like to trade on expiration dates, but I will favor the long side on a successful test of yesterday’s late lows around 830.00 on the SP or a breakout above the 844.50 level. “

Option expiration certainly showed a lot of volatility during Friday’s trading session, the highs at the Globex session with a positive opening, the sell off that exceeded by 3+- our 830.00 level and the strong reversal during the second half of the session.
Markets continue to move on high levels of uncertainty, and despite that the obvious move should be to the upside, the indexes have been showing wide intraday sell offs that indicate the lack of buying. Last Friday I explained that the strong sell off seen during the week that printed its low around 812.75 should get resolved with a countertrend rally that should last between 2-4 day, and that in the best case as first upside objective should be able to push the SP to the 884.00 level. Not doing so, will indicate that a strong downtrend has been initiated and that soon the November lows will be seen. This index, the SP, has been showing strong support around the 830.00 level, a few points above or below, and the Dow has been holding the 8050 despite last week false break. These areas will have to be defended by the bulls or this strong move down will get resumed during the next two trading sessions. I would be thinking that some kind of mercy could be given to the new President, and even, that the extension of a new rally attempt could bring prices back to the last highs around the 950.00 area, but the fear about the financial sectors and the ugly earnings season, could give way to a test of much more lower levels. Right now it is a problem to qualify the bounce from last week lows, has the market successfully printed a higher low, or this strong down trend that already pushed prices down during the first 15 days of the year the continuation of the primary bear trend? This will have to get resolved during the first trading days of this week, only two consecutive closes above the 858.50 area will open the doors for higher prices. The SP has built a support area during the last 45 days, and if that continues to hold, another test of the January highs could be seen before the bear campaign resumes. On the short term, the area above the 830.00-828.00 level which should act as strong support could result in a strong upside reversal in the upcoming sessions.
For today’s trading, session, during yesterday’s shorted holiday Globex session, the SP has already posted what it could be the range for today trading session. I assume most of the players will follow the Obama’s inauguration, so trading both sides of yesterday’s range should be the way to go, trade with tight stops, as despite that I am expecting a bullish session, the sell offs that the markets have been suffering have been wider than usual, 30.00 SP points from the highs, so please, don’t forget to place a stop. If there is something different to be seen during today’s trading session and the first hour lows hold, we could see and uptrend session, so don’t try to pick a top if a slow uptrend develops during the session.


TODAY’S SESSION
Initial resistance at 851.00-852.50 on the SP, 1201.00-1203.00 on the Nasdaq and 465.50-467.50 on the Russell. Trading above them will push the indexes to levels around last Friday’s reversal highs at 855.50-857.00, 1208.00-1210.00 on the Nasdaq and 469.70-470.50 on the Russell. If markets exceed those levels look for the rally to continue reaching 862.00-863.00 on the SP, 1216.00-1217.50 on the Nasdaq and 472.80-474.00. Trading above them will indicate a test of the important 868.00 level on the SP.


There is support at 845.00-844.00 on the SP, 1193.00-1191.00 on the NQ and 461.70-460.20 on the Russell. If the markets get there and rally, don’t expect these levels to be seen for a second time during the session, however, if those do not hold, look for some more profit taking that could push the indexes down to 840.50-839.50 on the SP, 1185.00-1183.00 on the Nasdaq and 458.10-457.30 on the Russell. Failing to rally from there, will indicate a test of 835.50-833.50 on the SP, 1179.50-1178.00 on the Nasdaq and 452.90-451.50 on the Russell. If the markets can not hold those areas, only 830.00-828.00 will offer some support before the indexes push down stronger for a test of last week lows. GOOD LUCK.
.





Futures and options trading have large potential rewards, but also LARGE POTENTIAL RISK. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to buy or sell futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed in this document. The past performance of any trading system or methodology is not necessarily indicative of futures results.
DAY TRADING INVOLVES HIGH RISK AND YOU CAN LOSE A LOT OF MONEY.
Every effort has been made to accurately represent all of our products and it's potential. As with any business there is a risk of loss of capital and there is no guarantee that you will earn any money. The financial markets are risky .Investing is risky. The foregoing has been prepared only and solely for informational purposes and is not a solicitation or an offer to buy or sell any security, option or futures contract. Opinion is based on historical research but there is not guarantee that futures results will be profitable. We are not advocating or recommending trading futures and our services, notes and entry and exit prices to the markets only reflects our opinion an a manner how markets can be traded. We mention many indexes like the S&P, NASDAQ, Russell, Dow Jones as T-Bonds only because they are the most known and liquid markets, and not because we recommend in any way to be traded.
You can lose more than your initial investment.
We are not Brokers, Registered Trading Advisors, Registered Investment Advisors or Commodity Trading Advisors. All the material contained here or in any communication is only for information purposes and part of our thoughts and personal conclusions.
Copyright © by theminitrade.com

luckyd1976

Thanks for keeping it all in one link. Easier to read.

arturo1

DAILY TRADING ADVISORY 21-January-2009


RBS bailout by British government, Fiat to get 35% stake in Chrysler, J&J beats analyst expectations. Banks share sink with Citigroup and Bank of America hitting their lowest levels since the early 1990s, after State Street Corp said it needs to raise capital as its shares fell as much as 55 percent in New York Stock Exchange composite trading, wiping out $8.7 billion of market value and dragging the stock market lower.


ECONOMIC DATA
10:35 AM Crude Inventories


YESTERDAY’S MARKET
After trading as high as 865.75 during Sunday’s Globex session, the E-mini SP started the day at 838.50 ready for President Obama’s inauguration event. After pushing up to 840.50 the index sold off strongly reaching 822.00 from where it bounced to 826.00 from where it pushed to a new low at 820.25. Another bouncing attempt reached 827.50, after sitting for a while up there, the SP pushed higher to our intraday resistance levels at 830.00. As the weakness continued, the SP pulled back to 823.50, bounced to 826.00 and pushed lower for a test of the lows. The double bottom resulted in a rebound to 828.00, but the markets failed to break higher just before the President’s inauguration. The SP pulled back once more to 823.50 where a series of small higher lows resulted in another bounce to 828.00 that failed pushing the SP to new lows at 816.25. Another weak rebound managed to reach 825.50 just to fall to 820.00, bounce back to 825.00 and fell to 818.00 where the selling dried. Once more the index managed to bounce but the extreme weakness resulted in another move to new lows, the SP reached 814.50. As the same pattern of trading continued with markets posting lower highs and lower lows, another feeble bounce gave way to a new intraday low, this time at 813.00 and then at 810.00 from where the SP manage to bounce to 816.00 just to repeat the pattern by posting a new low at 809.00, and then at 807.50 and 802.25. After posting the lows, a late correction pushed the SP to last week lows at 812.00 just to get sold into the end reaching 797.50 before bouncing a into the close. For the day, the SP lost 42.50 points and settled at 806.00, the Nasdaq ended lower by 49.50 points at 1147.50 and the Russell lost 31.00 ending the session at 432.60 The Dow closed below the 8000 mark at 7949 losing 4%, 332 points.


MARKET COMMENTARY AND OUTLOOK
Last Tuesday I wrote:“ Markets continue to move on high levels of uncertainty, and despite that the obvious move should be to the upside, the indexes have been showing wide intraday sell offs that indicate the lack of buying. Last Friday I explained that the strong sell off seen during the week that printed its low around 812.75 should get resolved with a countertrend rally that should last between 2-4 day, and that in the best case as first upside objective should be able to push the SP to the 884.00 level. Not doing so, will indicate that a strong downtrend has been initiated and that soon the November lows will be seen. This index, the SP, has been showing strong support around the 830.00 level, a few points above or below, and the Dow has been holding the 8050 despite last week false break. These areas will have to be defended by the bulls or this strong move down will get resumed during the next two trading sessions. Right now it is a problem to qualify the bounce from last week lows, has the market successfully printed a higher low, or this strong down trend that already pushed prices down during the first 15 days of the year the continuation of the primary bear trend? This will have to get resolved during the first trading days of this week; only two consecutive closes above the 858.50 area will open the doors for higher prices. On the short term, the area above the 830.00-828.00 level which should act as strong support could result in a strong upside reversal in the upcoming sessions.”

Yesterday’s broad based sell off and continuation downward move was done after the SP broke below the obvious support around 828.00-826.00 where a series of lows were seen during the last two months, after the November lows. With everybody hoping that a rally could get develop for the President Obama’s inauguration act, only a “suckers” rally that left some early birds trapped during Sunday’s Globex session at levels above the 850.00 area was what the markets were able to do. Yesterday was a wide range session where markets broke below the last two month consolidation. If this last down leg will be the one that will exhaust the bear trend, the SP should break below the November lows and probably reach the 700.00 area or lower. However, this bear market has been everything but normal, and if the index is capable to hold yesterday’s lows on a close and run above the 865.75 where the nightly high left an open gap, the next bear market rally could be much stronger than everybody will be expecting, and I am taking about another test of the most recent highs above the 950.00 area on the SP and 9400 on the Dow. Am I mad? It may be, but the madness of the current markets could give way for such a move. The key obviously will be that yesterday’s lows remain intact for today’s close and that the next countertrend rally, if it happens exceeds five days, that is valid if yesterday’s lows exhausted the current move.
Last week lows on the Nasdaq, 1138.50, were able to hold for most of the session, should a rally starts at these levels, those lows at 1138.50 MUST HOLD, otherwise my first described scenario for the SP will become a sad reality.
After yesterday’s huge sell off, there is a chance that the indexes will consolidate during today’s trading session before the next strong move happens, anything but this or a strong reversal resulting from an early low or an opening upside gap will result in additional weakness and selling pressure despite that markets are oversold at the current levels. So, markets are at the crossroads with not other chances that a strong bounce or a test of the November lows.


TODAY’S SESSION
There is initial resistance at 812.50-813.50 on the SP, 1155.50-1156.00 on the Nasdaq and 435.80-436.50 on the Russell, if those get exceeded markets should be able to reach 818.50-820.00 on the SP, 1164.00-1165.50 on the Nasdaq and 439.50-440.80 on the Russell. Breaking above those areas could indicate that a countertrend move has been initiated and the index should be able to test thir next resistance levels at 825.75-827.50 on the SP, 1172.00-1174.00 on the Nasdaq and 445.90-447.00 on the Russell. If those are the highs and the markets fail to trade above them during today or tomorrow’s session, the way to the November lows will be open.

Initial support is just above yesterday’s late lows at 799.75-798.00 on the SP, 1139.00-1138.00 on the Nasdaq and 429.40-428.10 on the Russell, if the indexes do not hold a pullback to those levels yesterday’s huge sell off should continue at least to the next support areas at 793.50-791.50 on the SP, 1131.00-1129.50 on the Nasdaq and 424.50-423.70 on the Russell. If those are not aggressively bought look for the melt down to gain force as the indexes test their next areas at 787.00-785.00 on the SP, 1122.50-1121.00 on the Nasdaq and 419.10-418.60 on the Russell. GOOD LUCK.


.




Futures and options trading have large potential rewards, but also LARGE POTENTIAL RISK. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to buy or sell futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed in this document. The past performance of any trading system or methodology is not necessarily indicative of futures results.
DAY TRADING INVOLVES HIGH RISK AND YOU CAN LOSE A LOT OF MONEY.
Every effort has been made to accurately represent all of our products and it's potential. As with any business there is a risk of loss of capital and there is no guarantee that you will earn any money. The financial markets are risky .Investing is risky. The foregoing has been prepared only and solely for informational purposes and is not a solicitation or an offer to buy or sell any security, option or futures contract. Opinion is based on historical research but there is not guarantee that futures results will be profitable. We are not advocating or recommending trading futures and our services, notes and entry and exit prices to the markets only reflects our opinion an a manner how markets can be traded. We mention many indexes like the S&P, NASDAQ, Russell, Dow Jones as T-Bonds only because they are the most known and liquid markets, and not because we recommend in any way to be traded.
You can lose more than your initial investment.
We are not Brokers, Registered Trading Advisors, Registered Investment Advisors or Commodity Trading Advisors. All the material contained here or in any communication is only for information purposes and part of our thoughts and personal conclusions.
Copyright © by theminitrade.com

arturo1

DAILY TRADING ADVISORY 22-January-2009


World’s banks collapsing and close to a global nationalization as Obama’s team readies a rescue plan, IBM Corp. providing a better than expected profit outlook for 2009 after reporting strong fourth quarter earnings, United Technologies topping earnings consensus, GE fourth quarter sales down 26%, Apple rallies after record sales, NAHB housing market index hitting a new low and Treasury nominee Geithner pledging aggressive action to get economy moving result in a positive session after Tuesday’s huge sell off.


ECONOMIC DATA
8;30 AM Building Permits
8:30 AM Housing Starts
8:30 AM Initial Claims


YESTERDAY’S MARKET
After Tuesday’s huge sell off where the SP posted its daily low at 797.50, markets rallied during the nightly Globex session with the E-mini SP starting the day at 815.50. After a mild pullback to 814.00 and with the Nasdaq joining the move, the SP pushed to a new intraday high at 817.25, just below the 818.00 Globex highs. Then, the SP pulled back to 811.00, just above our updated support area from where it moved back up testing the Globex highs at 918.00 and pushing a bit higher to 820.25. As the new Treasury Secretary started his speech, the SP pulled back to 813.50 and bounced to 818.50. A small double top at that level resulted in another pullback, this time just below our support 808.50 area. The SP bounced a couple of points where sellers stepped in pushing the index down to 800.50. The SP bounced to 806.50, backed off to 802.25 and pushed higher to 812.75 where the rally attempt fail resulting in another pullback that managed to hold at 807.50 giving way for another bounce, this time to 814.00 where the move topped. Another pullback held our updated support levels at 807.00 where buyers stepped in pushing the index up to 816.00, traded in a narrow range and finally broke higher reaching 818.75. As the slow struggling rally continued the SP finally pushed higher reaching 824.50 while the Nasdaq matched its early 1164.50 highs. After a few additional attempts to break higher where the SP and Nasdaq only moved one tick higher and the Dow futures contract fail short of breaking above 8100. After trading in a narrow range near the highs, the indexes finally pushed higher gaining some additional momentum with the SP reaching 830.50 and the Nasdaq 1174.75. A late pullback to 824.50 was met by buyers pushing the SP to a new high at 833.75 and continuing up to 838.50 closing near the highs. For the day, the SP gain 30.75 points ending the session at 836.75, the Nasdaq advanced 34.00 points and settled at 1181.50 and the Russell closed higher by 21.1 points at 453.70.


MARKET COMMENTARY AND OUTLOOK
Last Tuesday I wrote:“ Yesterday’s broad based sell off and continuation downward move was done after the SP broke below the obvious support around 828.00-826.00 where a series of lows were seen during the last two months, after the November lows. With everybody hoping that a rally could get develop for the President Obama’s inauguration act, only a “suckers” rally that left some early birds trapped during Sunday’s Globex session at levels above the 850.00 area was what the markets were able to do. Yesterday was a wide range session where markets broke below the last two month consolidation. If this last down leg will be the one that will exhaust the bear trend, the SP should break below the November lows and probably reach the 700.00 area or lower. However, this bear market has been everything but normal, and if the index is capable to hold yesterday’s lows on a close and run above the 865.75 where the nightly high left an open gap, the next bear market rally could be much stronger than everybody will be expecting, and I am taking about another test of the most recent highs above the 950.00 area on the SP and 9400 on the Dow. Am I mad? It may be, but the madness of the current markets could give way for such a move. The key obviously will be that yesterday’s lows remain intact for today’s close and that the next countertrend rally, if it happens exceeds five days, that is valid if yesterday’s lows exhausted the current move. After yesterday’s huge sell off, there is a chance that the indexes will consolidate during today’s trading session before the next strong move happens, anything but this or a strong reversal resulting from an early low or an opening upside gap will result in additional weakness and selling pressure despite that markets are oversold at the current levels. So, markets are at the crossroads with not other chances that a strong bounce or a test of the November lows.”

We came into yesterday’s session looking for a positive opening as the markets try to show some signs of life after Tuesday’s huge sell off. The Globex high and higher opening, almost 20.00 points above Tuesday’s lows placed the indexes in a good position for a strong reversal, but get sold strongly pushing the indexes down for a successful test of Tuesday’s lows. This test may be seen as the first attempt of another strong countertrend move after the strong sell off seen during the last ten days, and if it manages to last more than five trading sessions could surprise by reaching the 950.00 area. Yesterday’s consolidation and correction rally was expected as it was an “inside day”, the early sell off attempts managed to found support above Tuesday’s lows and if we want to be optimistic markets could be in the process of building a base for an upcoming strong rally, however, the downtrend has been very strong and the markets have a long way to go before calling a short term low.
As the rally came from a successful test of Tuesday’s lows posting a small double bottom, and closed above the 830.50 previous support and now resistance areas, has left the indexes in a strong position, however, if today we have some additional sideways trading and not a continuation pattern, markets will still have a chance to go for another test of the lows. Meanwhile the obstacles for this rally to continue are multiple, fundamental and technical. Many resistance levels will have to get exceeded only to place the SP on a neutral position, 847.00-850.00, 863.00 and then 870.00.
The pattern is clearer in the Nasdaq, multiple test of the 1140.00-1138.00 lows has created a floor for that index, and they have held any sell off attempt, the last thing is a false break below 1138.00 that has been already reversed. More strength could be seen in that index above the 1205.00 and 1220.00 areas. The Dow has been the weaker, and it can continue to test the 8000 level while facing many resistance areas at 8300, 8400 and 8550.
So for today’s trading session, the important fact will be for the indexes to show additional strength, despite any economic news, and after yesterday’s “strong rally” this appears to be the higher probability. Should this rally fail in the next 3 days and resume the downtrend, or it will continue higher, and as I wrote last Tuesday, go for another test of the 950.00 level? We should have the answer during next week. Meanwhile we can expect the markets to try and move higher, so buying the deeps could be the way to go during today’s trading session. Try to maintain a long position when the markets trade in positive territory.


TODAY’S SESSION
Initial resistance is at 841.00-843.50 on the SP, 1186.00-1188.00 on the Nasdaq and 456.00-456.90 on the Russell, trading above them could indicate a continuation of yesterday’s rally pushing the indexes up to their next levels at 848.00-850.00 on the SP 1195.00-1196.00 on the Nasdaq and 459.80-460.30 on the Russell. If the rally stalls there look for some profit taking, around 12.00 points on the SP, however if the markets push above them, in particular during the last two hours of the session, look for some more short covering that could move markets up to 856.50-857.50 on the SP, 1205.00-1206.00 on the Nasdaq and 463.50-465.00 on the Russell.

There is good support at yesterday’s last hour pivot point around 833.50-831.00 on the SP, 1177.50-1176.00 on the Nasdaq and 451.00-449.70 on the Russell. If those can not hold, yesterday’s rally will be on jeopardy as the markets will be on their way for our second support areas at 828.00-826.00 on the SP, 1172.00-1170.00 on the Nasdaq and 445.60-445.10 on the Russell. These are extremely important areas to maintain this bounce alive. Failing to rally strong from those levels will place the bears in control and the indexes could reach 818.50-816.50 on the SP, 1160.00-1158.00 on the Nasdaq and 440.80-439.60 on the Russell. GOOD LUCK


.




Futures and options trading have large potential rewards, but also LARGE POTENTIAL RISK. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to buy or sell futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed in this document. The past performance of any trading system or methodology is not necessarily indicative of futures results.
DAY TRADING INVOLVES HIGH RISK AND YOU CAN LOSE A LOT OF MONEY.
Every effort has been made to accurately represent all of our products and it's potential. As with any business there is a risk of loss of capital and there is no guarantee that you will earn any money. The financial markets are risky .Investing is risky. The foregoing has been prepared only and solely for informational purposes and is not a solicitation or an offer to buy or sell any security, option or futures contract. Opinion is based on historical research but there is not guarantee that futures results will be profitable. We are not advocating or recommending trading futures and our services, notes and entry and exit prices to the markets only reflects our opinion an a manner how markets can be traded. We mention many indexes like the S&P, NASDAQ, Russell, Dow Jones as T-Bonds only because they are the most known and liquid markets, and not because we recommend in any way to be traded.
You can lose more than your initial investment.

arturo1

DAILY TRADING ADVISORY 23-January-2009


Initial Claims at 589K, continuing claims at 4.6 million, its highest since 1982 recession and Building Permits and Housings Starts at record low levels; indications that GE will cut its dividend and will need government assistance. Market falls but closes with a partial recovery.


ECONOMIC DATA
None


YESTERDAY’S MARKET
Following a positive Globex session where the SP reached 844.00 and the Nasdaq 1202.25, markets started to move lower a few hours before the opening making lows as the economic data was released and moving much lower as Microsoft earning get released. The E-mini SP opened the session at 820.00, pulled back to 818.50 and rallied to 824.75 where the early bounce failed. Leaded by the weakness in the Nasdaq, the SP pushed down to 816.50 where another strong bounce topped at 824.50 resulting in another visit to the lows. As the trading session continued the SP kept trading between the 816.50 lows and the 824.50 intraday resistance levels while posting in the chart a new marginal low at 815.00. As strong support continues to show at the lows, the SP bounced back to 820.00 and sold off to new lows at 813.00. The index bounced to 818.75 just to fail once more to trade above my 820.50 intraday resistance area from where it sold off strong reaching 807.50 where the move bottomed. The SP rallied to 813.50, and once that level got exceeded, the index pushed all the way up to the 820.00 level where the rally stalled resulting in a pullback that held 813.50. As the session continued, the SP traded between the 813.00 and 820.00 areas and once the buyers stepped in the index moved up all the way to 835.50 that in the past acted as a pivot points. After failing to break higher the index get reversed pushing to the 830.00 level, however, bears gained control and the SP fell to 815.50 where a double bottom gave way to a late short covering rally that topped at 830.00 from where the market pulled back into the close.


MARKET COMMENTARY AND OUTLOOK
Last Tuesday I wrote: “Yesterday’s consolidation and correction rally was expected as it was an “inside day”, the early sell off attempts managed to found support above Tuesday’s lows and if we want to be optimistic markets could be in the process of building a base for an upcoming strong rally, however, the downtrend has been very strong and the markets have a long way to go before calling a short term low. As the rally came from a successful test of Tuesday’s lows posting a small double bottom, and closed above the 830.50 previous support and now resistance areas, has left the indexes in a strong position, however, if today we have some additional sideways trading and not a continuation pattern, markets will still have a chance to go for another test of the lows. Meanwhile the obstacles for this rally to continue are multiple, fundamental and technical. Many resistance levels will have to get exceeded only to place the SP on a neutral position, 847.00-850.00, 863.00 and then 870.00. The pattern is clearer in the Nasdaq, multiple test of the 1140.00-1138.00 lows has created a floor for that index, and they have held any sell off attempt, the last thing is a false break below 1138.00 that has been already reversed. More strength could be seen in that index above the 1205.00 and 1220.00 areas. The Dow has been the weaker, and it can continue to test the 8000 level while facing many resistance areas at 8300, 8400 and 8550.”

We came into yesterday’s session looking for some additional strength or a consolidation move as we considered that the markets could be building a base for another rally attempt. The early sell off that posted a higher low and resulted in another “inside day” gave longs and shorts trading opportunities.
If we look at the daily charts we should come to the conclusion that anything can happen at this moment, on the bullish side, the markets has successfully tested their most recent lows and have shown rising volume with buying pressure, they got another successful test of the 800.00 on the SP 8000 on the Dow and 1140.00 on the Nasdaq. HOWEVER, many time these kinds of consolidations, when happen in bear markets result in additional weakness, in this case, we could see another false break of the levels I just mentioned that give way to a strong reversal rally, or finally a break below them that take the markets to their next lower levels, at least 750.00 on the SP, 7500 on the Dow and 1060.00 on the Nasdaq. So with this lack of direction, the next move can be to either side, following the 800.00 level in the SP together with 8000 in the Dow for the downside and, 844.00 and 8300 to the upside, until they get broken for the next substantial move is what it should be done until we see some continuation of any move. The most probable scenario seem to be another test of the support levels, and then if they hold, the indexes will be in a strong position for another visit to the January highs; if that not happen and the markets fail to rally from their daily support levels, them the downtrend will get resumed and markets will go for a test of the November lows.
Traders are very nervous about the current earnings reports, banks, tech companies and industrials, all of them under strong pressure, today, GE will be reporting, if the numbers get released before the opening that should rule the first half of the session. Keep a close eye on the opening price, not at yesterday’s settlements, and use that level as an intraday pivot for market direction.

TODAY’S SESSION
There is resistance at 828.50-829.50 on the SP, 1177.00-1178.00 on the Nasdaq and 446.40-447.20 on the Russell. All the time that the indexes are trading below those levels, sellers remain in full control. Trading above them will indicate a test of the at 833.00-834.50 on the SP, 1184.00-1185.50 on the Nasdaq and 449.80-451.00 on the Russell. Be ready for a reversal if the indexes fail to break higher, if they do it, only 840.00-841.00 on the SP, 1201.00-1203.00 on the Nasdaq and 457.90-458.60 on the Russell will be the last obstacle for a possible upside breakout..

There is support at 822.00-821.00 on the SP, 1167.00-1165.00 on the NQ and 441.60-440.10 on the Russell. Those levels are very important and if the open is below them and later in the session they get exceeded look for a good rally. But if markets are weak, then yesterday’s late lows at 818.00-815.50 on the SP, 1161.00-1159.50 on the Nasdaq and 438.00-436.90 on the Russell will get tested. Failing to hold there could accelerate the downtrend pushing markets to 811.00-810.00 on the SP, 1152.00-1150.00 on the Nasdaq and 431.30-429.40 on the Russell. If those can not hold, look for another test of the 800.00’s. GOOD LUCK.


.




Futures and options trading have large potential rewards, but also LARGE POTENTIAL RISK. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to buy or sell futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed in this document. The past performance of any trading system or methodology is not necessarily indicative of futures results.
DAY TRADING INVOLVES HIGH RISK AND YOU CAN LOSE A LOT OF MONEY.
Every effort has been made to accurately represent all of our products and it's potential. As with any business there is a risk of loss of capital and there is no guarantee that you will earn any money. The financial markets are risky .Investing is risky. The foregoing has been prepared only and solely for informational purposes and is not a solicitation or an offer to buy or sell any security, option or futures contract. Opinion is based on historical research but there is not guarantee that futures results will be profitable. We are not advocating or recommending trading futures and our services, notes and entry and exit prices to the markets only reflects our opinion an a manner how markets can be traded. We mention many indexes like the S&P, NASDAQ, Russell, Dow Jones as T-Bonds only because they are the most known and liquid markets, and not because we recommend in any way to be traded.
You can lose more than your initial investment.
We are not Brokers, Registered Trading Advisors, Registered Investment Advisors or Commodity Trading Advisors. All the material contained here or in any communication is only for information purposes and part of our thoughts and personal conclusions.
Copyright © by theminitrade.com

arturo1

DAILY TRADING ADVISORY 26-January-2009


Google delivers good looking results. Microsoft to cut 5000 jobs. Markets traded down during last week. GE reported as expected with a 46% decline in profits but not cutting dividends and expecting to keep its triple A rating. AMD, Capital One and Xerox shares retreat. Markets started the session sharply lower but managed to recover most of the losses.


WEEKLY PIVOTS FOR WEEK ENDING 30- January-2008

R3 897.00
R2 861.00
R1 842.00
PP 829.00
S1 817.00
S2 792.50
S3 776.25

ECONOMIC DATA
10:00 AM Existing Home Sales
10:00 AM Leading Indicators

WEEKLY RECAP
This was another negative week for the markets as concerns about recession and earnings growth. Last shortened holiday week posted its high during Sunday’s Globex nightly session reaching 865.75. The Martin Luther King Globex session where the regular markets remained close pushed the SP down closing at 840.00. The real action started on Tuesday, President Obama’s inauguration event resulted in a huge sell off on all the markets. Early news about RBS bailout by the British Government gave reasons for the U.S. bank shares to trade down; Citigroup and Bank of America hit their lowest levels since the early 1990s, also State Street Corp said it needs to raise capital as its shares fell as much as 55 percent in New York Stock Exchange composite trading, wiping out $8.7 billion of market value and dragging the stock market sharply lower. Fiat announced that it will take a 35% stake in Chrysler in exchange for technology and global marketing, 355 for nothing, that just indicates how desperate the situation is for the automakers is. For the first time since November the SP traded at the 800.00 mark. For the day, the SP lost 42.50 points and settled at 806.00, the Nasdaq ended lower by 49.50 points at 1147.50 and the Russell lost 31.00 ending the session at 432.60 The Dow closed below the 8000 mark at 7949 losing 4%, 332 points. Wednesday’s session gave way to a bounce from oversold conditions, the session started with a positive tone, IBM 2009 positive outlook and UTX topping earnings consensus, a bounce in the banking shares, Apple record sales gave investors a bit of confidence. The NAHB housing market index posted a new low while Treasury nominee Geithner pledged aggressive action to get the economy moving. Despite rumors that GE will report an ugly fourth quarter numbers markets closed with strong note. The SP gain 30.75 points ending the session at 836.75, the Nasdaq advanced 34.00 points and settled at 1181.50 and the Russell closed higher by 21.1 points at 453.70. Thursday’s session showed the fragility of the previous day rally, not too much reasons to be a buyer, Initial claims at 589K, Continuing claims reaching 6.4 million and Housing Starts and Building Permits at record lows kept the markets under pressure despite wild intraday reversals, on the corporate area, Microsoft reporting below expectations and ready to cut 5000 jobs, and indications that GE will cut its dividend and may need government assistance gave way to a negative session, the SP lost 11.25 points and closed at 825.50, the Nasdaq lost 9.25 points ending the session at 1172.25 and the Russell closed lower 9.70 points at 444.00. The Dow lost 105 points closing at 8122. Friday’s Globex session markets traded sharply down. The previous night, Google reported not so bad numbers for a recession but heavy losses in the world markets pushed down the futures contracts to near the worst levels of the week. News that the U.K. economy shrank more than economists forecast during the fourth quarter in the biggest contraction since 1980, with the financial crises bringing the banks near insolvency, and the British pound collapsing against the yen and the dollar. GE reported as expected, not cutting dividends and expecting to keep its triple A rating. After trading below the 800.00 mark before the opening, all the indexes were able to pare most of their losses as investors showed some buying interest since the beginning of the session. For the day, the SP lost two points and settled at 823.50, the Nasdaq ended lower by 8.00 points at 1164.25 and the Russell lost 4.60 points closing the session at 439.40. The Dow lost 45 points and settled at 8077.



FRIDAY’S MARKETS
Friday’s action started during the Globex session, a sharply downside move pushed the SP to 801.25 from where the index bounced to 805.50 before GE earnings were released and once they were announced showing no surprises, the SP continue higher to 811.75 but two hours later was making a low at 799.50. The E-mini SP started the session at 804.25 from where it bounced to 807.50, get sold to 801.50 and rallied to 809.00, all this in the first seven minutes of the session. As the early short covering continued, the SP reached my resistance 811.00 area from where it pulled back to 805.00 and rallied to 813.25 from where it pulled back a few points and then placed a new intraday high at 817.00 where the move stalled. As the index failed to break higher, sellers came in pushing the SP down to 808.00. As our intraday support are held the pullback, the SP pushed up to a new intraday high at 819.50. as the rally continued and the shorts started to cover, the SP reached my pivot 825.25 area from where the index pulled back to 818.50, bounced back to a lower high and sold off to 813.00. After holding our support level, the SP bounced all the way up to the highs, where a triple top gave way to another pullback, this time to 816.00. Unable to push lower the index resumed its uptrend reaching 832.25 and then my upside objective at 836.00 where once more a lower high resulted in some profit taking that pushed the index all the way down to 821.50, bounced back to 827.00, tested the 821.50 level a few times and rallied back to 828.00, pulled back once more and repeated the previous bounce just to get sold into the close. For the day, the SP lost two points and settled at 823.50, the Nasdaq ended lower by 8.00 points at 1164.25 and the Russell lost 4.60 points closing the session at 439.40. The Dow lost 45 points and settled at 8077.


MARKET COMMENTARY AND OUTLOOK
Last Friday I wrote:” If we look at the daily charts we should come to the conclusion that anything can happen at this moment, on the bullish side, the markets has successfully tested their most recent lows and have shown rising volume with buying pressure, they got another successful test of the 800.00 on the SP 8000 on the Dow and 1140.00 on the Nasdaq. HOWEVER, many time these kinds of consolidations, when happen in bear markets result in additional weakness, in this case, we could see another false break of the levels I just mentioned that give way to a strong reversal rally, or finally a break below them that take the markets to their next lower levels, at least 750.00 on the SP, 7500 on the Dow and 1060.00 on the Nasdaq. So with this lack of direction, the next move can be to either side, following the 800.00 level in the SP together with 8000 in the Dow for the downside and, 844.00 and 8300 to the upside, until they get broken for the next substantial move is what it should be done until we see some continuation of any move. The most probable scenario seem to be another test of the support levels, and then if they hold, the indexes will be in a strong position for another visit to the January highs; if that not happen and the markets fail to rally from their daily support levels, them the downtrend will get resumed and markets will go for a test of the November lows. Keep a close eye on the opening price, not at yesterday’s settlements, and use that level as an intraday pivot for market direction. “


We came into Friday’s session waiting for the possibility of a false break below the 800.00 area on the SP that get reversed resulting in a strong rally, we also recommended to follow the opening price for market direction; we got both, an initial sell off, most of it done during the Globex session resulting in a marginal low below the 800.00 area, and the initial pullback below the 804.50 opening price that lasted less than two minutes and once it get exceeded markets never looked back.
So we are almost as Friday, the strong support seen around the 800.00 level on the SP and 1140.00-1136.00 on the Nasdaq has been able to hold, now, for a fourth consecutive session. The 8000 on the futures Dow has been rejected a few times, but the cash index has hold above it. Will the indexes continue to build out within the range before making a breakout? Or maybe, they are trading the last sessions building a base for an upcoming rally? Those are the only two probabilities, and both favor the upside unless the strong support areas at the levels I just mentioned get decisively broken.
Friday’s early reversal was done with a lot of short covering and some mild buying activity and the late sell off can be qualified as normal for a Friday as traders do not find a reason to stay long for the weekend. The key, for a resume of a countertrend rally will be to see some follow through during the next two sessions pushing the indexes up for a close above 844.00 on the SP 1210.00 on the NQ and 8300 on the Dow, if that happens, we could be ready for another bear market rally. Obviously a close below the support areas will point to a test of the November lows and maybe more. So at this moment there is more risk taking a short position than a long shot, but I don’t mean by that that the markets have a reason for a sustainable rally, but perhaps, in front of this week FOMC rate decision some short covering could be seen, and if the markets finally move up, then a second degree countertrend, a 7-10 days rally that could find a top before Friday next week when the January unemployment numbers get released, or fail this coming Friday when the GDP preliminary number for the fourth quarter is issued.
On the other side of the coin, markets have not been able to trade above the previous day’s high, and any possible bounce at this moment looks only as short covering as a result of the inability to break the support areas, so breaking below them could result in a fast down move.
Last Friday we recommended to trade using the opening price as a pivot, for today, I will like to see the markets finally trading in positive territory, or holding the first hour lows in order to get long, and of curse, I will be very careful with any new short, the markets is already down seven days and it may be ready for a bounce that finally breaks this lower highs pattern.

TODAY’S SESSION
There is initial resistance at 826.75-828.50 on the SP, 1167.50-1169.00 on the Nasdaq and 441.60-442.70 on the Russell. Trading above them will push the indexes to levels just below last Friday’s highs on the SP, 831.50-833.00, and 1173.00-1174.00 on the Nasdaq and 445.10-446.00 on the Russell. If markets fail there it’s probable that at least we’ll see a pullback to our first support areas, but of both, the SP and Nasdaq break higher, expect the move to continue and probably reach 838.00-839.00 on the SP, 1178.00-1180.00 on the Nasdaq and 450.60-452.40 on the Russell. Trading above them will point for a test of the last double top around 844.00 on the SP and last Friday’s highs on the Nasdaq.


There is support at 820.00-818.50 on the SP, 1159.75-1157.50 on the NQ and 437.20-435.80 on the Russell. If markets are strong those may be able to hold, but if we’ll see more back and forth action, look for a test of 815.00-813.50 on the SP, 1153.00-11515.50 on the Nasdaq and 432.80-432.00 on the Russell. If those can not hold, then the next support areas at 810.00-808.50 on the SP, 1145.00-1144.00 on the Nasdaq and 429.10-427.80 on the Russell will have to make the job or another test of the most recent daily lows could happen. GOOD LUCK.
.









Futures and options trading have large potential rewards, but also LARGE POTENTIAL RISK. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to buy or sell futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed in this document. The past performance of any trading system or methodology is not necessarily indicative of futures results.
DAY TRADING INVOLVES HIGH RISK AND YOU CAN LOSE A LOT OF MONEY.
Every effort has been made to accurately represent all of our products and it's potential. As with any business there is a risk of loss of capital and there is no guarantee that you will earn any money. The financial markets are risky .Investing is risky. The foregoing has been prepared only and solely for informational purposes and is not a solicitation or an offer to buy or sell any security, option or futures contract. Opinion is based on historical research but there is not guarantee that futures results will be profitable. We are not advocating or recommending trading futures and our services, notes and entry and exit prices to the markets only reflects our opinion an a manner how markets can be traded. We mention many indexes like the S&P, NASDAQ, Russell, Dow Jones as T-Bonds only because they are the most known and liquid markets, and not because we recommend in any way to be traded.
You can lose more than your initial investment.
We are not Brokers, Registered Trading Advisors, Registered Investment Advisors or Commodity Trading Advisors. All the material contained here or in any communication is only for information purposes and part of our thoughts and personal conclusions.
Copyright © by theminitrade.com

arturo1

DAILY TRADING ADVISORY 27-January-2009


Pfizer buying Wyeth, Caterpillar reporting lower than expecting earnings and announcing a 20K jobs cut, McDonalds 4cents above consensus, Barclays rallying on news that it won’t need to rise additional capital, Home Depot to cut 7K jobs. Leading Indicators up by .3% and December Existing Home sales up by 6.5% result in a positive close for the U.S. equity markets.


ECONOMIC DATA
10:00 AM Consumer Confidence
10:00 AM S&P Case Shiller Index


YESTERDAY’S MARKET
After recovering from much lower prices during the Globex session where the SP reached 810.75, the E-mini SP started the session at 831.50 and after pulling back one single point pushed up strongly reaching 842.25 from where the index pulled back to 836.50 where additional buying was seen pushing the SP up to 849.50. Once the index made its early highs and the rally stalled, the SP pulled back to 843.50, traded in a narrow range near those levels and pulled back to 840.50. The E-mini SP bounced back to 844.50 but failed to break higher after a few attempts abs traded in a narrow range between that levels an 838.50. Once the lows fail to hold and the other indexes lost their steam bears regain control pushing the SP down all the way to 824.00. The SP bounced strong reaching 840.50 but got sold into the end of the session. For the day, the SP added 7.25 points ending the session at 830.75, the Nasdaq added 15.25 points and settled at 1179.50 and the Russell added 6.70 ending the day at 446.10. The Dow closed higher by 38.00 points at 8112.


MARKET COMMENTARY AND OUTLOOK
Last Tuesday I wrote: “So we are almost as Friday, the strong support seen around the 800.00 level on the SP and 1140.00-1136.00 on the Nasdaq has been able to hold, now, for a fourth consecutive session. The 8000 on the futures Dow has been rejected a few times, but the cash index has hold above it. Will the indexes continue to build out within the range before making a breakout? Or maybe, they are trading the last sessions building a base for an upcoming rally? Those are the only two probabilities, and both favor the upside unless the strong support areas at the levels I just mentioned get decisively broken. Friday’s early reversal was done with a lot of short covering and some mild buying activity and the late sell off can be qualified as normal for a Friday as traders do not find a reason to stay long for the weekend. The key, for a resume of a countertrend rally will be to see some follow through during the next two sessions pushing the indexes up for a close above 844.00 on the SP 1210.00 on the NQ and 8300 on the Dow, if that happens, we could be ready for another bear market rally. Obviously a close below the support areas will point to a test of the November lows and maybe more. So at this moment there is more risk taking a short position than a long shot, but I don’t mean by that that the markets have a reason for a sustainable rally, but perhaps, in front of this week FOMC rate decision some short covering could be seen, and if the markets finally move up, then a second degree countertrend, a 7-10 days rally that could find a top before Friday next week when the January unemployment numbers get released, or fail this coming Friday when the GDP preliminary number for the fourth quarter is issued.”

After seven negative sessions, markets were finally able to close on positive territory despite the choppy trading conditions seen during the trading session, not easy to be a bull and npt easy to sell the indexes if you are a day trader. Yesterday’s early run was done, as expected with light volumes. And it was more like shorts covering their position after the strong opening. The SP finally broke above the 844.00 area that I mentioned yesterday and last Friday, however the lack of participation and commitment to hold above that level for the close was more than obvious.
So, despite the fact that the SP was able to break the recent trading pattern of lower highs, its still trading between the most recent ranges, and even if we can see some more upside pressure, the selling activity seen at the highs still indicates that at every rally, bear are waiting to take advantage of it. The action in the Nasdaq and in the Dow is similar, both indexes continue to built between the trading range and this can continue for a few more days until a decisive breakout occurs.
Yesterday’s high will have to get exceeded with strength in order for the markets to try and break higher, obviously, 850.00 on the SP 1204.00’s on the Nasdaq and 8250 on the Dow are the next levels that will have to get beaten for the indexes to move higher in this daily bounce attempt that can not be qualified right now as a change in direction, that will be possible only if the current rally last for more than five trading sessions. Obviously, the first step will be to see some follow through for yesterday’s move.
For today’s trading session, all the time that yesterday’s highs remain intact or just get tested, look for more sideways action, sell near resistance areas, maybe yesterday’s highs looking for a double top, and try to get long if the SP pushes 20.00 points down from its high.


TODAY’S SESSION
There is resistance at 834.00-836.00 on the SP, 1183.00-1184.50 on the Nasdaq and 448.50-450.20 on the Russell. Breaking above them will indicate a test of the next levels at 841.50-842.00 on the SP, 1189.00-1191.00 on the Nasdaq and 453.20-454.70 on the Russell. Yesterday’s late bounce failed to break above them, so be ready for a reversal if a rally fails there, if they get finally broken look for resistance around yesterday’s highs at 849.00-851.00 on the SP, 1196.00-1198.00 on the Nasdaq and 458.60-460.30 on the Russell. Too many bulls or short will be needed to break above those areas.

There is support above yesterday’s lows at 838.00-827.00 on the SP, 1174.00-1172.50 on the Nasdaq and 443.70-441.80 on the Russell. If those can not hold, look for weakness to be present as the indexes test the 824.00-822.50 on the SP, 1168.090-1166.00 on the Nasdaq and 439.00-438.50 on the Russell. A double bottom at those levels could give way to a 15.00- to 18.00 point rally on the SP, but if they fail to hold, look for the markets to continue and move lower reaching 818.00-815.50 on the SP, 1160.00-1158.50 on the Nasdaq and 432.40-431.80 on the Russell. GOOD LUCK.


.




Futures and options trading have large potential rewards, but also LARGE POTENTIAL RISK. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. Don't trade with money you can't afford to lose. This is neither a solicitation nor an offer to buy or sell futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed in this document. The past performance of any trading system or methodology is not necessarily indicative of futures results.
DAY TRADING INVOLVES HIGH RISK AND YOU CAN LOSE A LOT OF MONEY.
Every effort has been made to accurately represent all of our products and it's potential. As with any business there is a risk of loss of capital and there is no guarantee that you will earn any money. The financial markets are risky .Investing is risky. The foregoing has been prepared only and solely for informational purposes and is not a solicitation or an offer to buy or sell any security, option or futures contract. Opinion is based on historical research but there is not guarantee that futures results will be profitable. We are not advocating or recommending trading futures and our services, notes and entry and exit prices to the markets only reflects our opinion an a manner how markets can be traded. We mention many indexes like the S&P, NASDAQ, Russell, Dow Jones as T-Bonds only because they are the most known and liquid markets, and not because we recommend in any way to be traded.
You can lose more than your initial investment.
We are not Brokers, Registered Trading Advisors, Registered Investment Advisors or Commodity Trading Advisors. All the material contained here or in any communication is only for information purposes and part of our thoughts and personal conclusions.
Copyright © by theminitrade.com