DAILY TRADING ADVISORY 10-September-2009
ROLLOVER DAY IS TODAY 10 SEPTEMBER 2009
ALL MY NUMBERS ARE BASED IN THE DECEMBER CONTRACTS
Markets continue to press higher, Fed’s Beige Book: worst recession since 1930 may be over.
ECONOMIC DATA
8:30 AM Initial Claims
8:30 AM Trade Balance
YESTERDAY’S MARKET
After trading quite during the Globex session, the E-mini SP started the day at 1026.25 from where it pulled back to 1023.25. After a few attempts to break lower, the index rallied to 1030.25 where the bounce lost its steam and posted a double top. The index pulled back to 1027.50, but with strong support coming in near the highs it pushed up to a new intraday high at 1030.75. As the rally continued and leaded by the strength on the Nasdaq, the SP made its way higher reaching 1035.25. Later a new marginal high at 1036.25 posted the intraday high. After holding in a narrow range above the 1033.00 level, markets finally pulled back, the SP tested 1028.25, just at my intraday support area. After bouncing to 1030.75 it backed off to 1027.00 and held, so the index pushed up to 1031.50 and pulled back but bounced to test the 1034.50. For the day, the SP closed higher by 7.75 points at 1032.75, the Nasdaq added 12.25 points and settled at 1667.50 and the Russell finished the session at 585.10 with a 9.20 points gain. The Dow added 49 points closing at 9547.
MARKET COMMENTARY AND OUTLOOK
Yesterday I wrote: “After last week mild correction in which the SP found support well above my 978.00, the markets have recovered nicely just to the pre sell off level, the 1028.50 area on the SP. If this was a lower high, that area will have to remain intact on the close. However, there is not argument to discharge another test of the 1040.00’s, and there is not argument to discharge a new high on all the markets. The Nasdaq, which leaded the rally from the march lows, has been lagging and showing some problems around the 1650.00 area, but the consolidation in that index will probably get resolved to the upside, support is coming at very high levels, so there is not a reason to be short that market. It is not that I am expecting a wild rally, no, but I do expect the indexes to slowly work their way higher, under this assumption, I will continue to be a buyer on the dips watching closely the Nasdaq and the 1018.50 area on the SP, if the markets are trading negative or the SP breaks below that area, I may stay on the sidelines and probably wait for a test of the 1010.00 level..”
The markets acted as expected, no wild moves but a clear bullish bias. Finally, and after trading in a long sideways pattern for a long period, the Nasdaq reached my 1675.00 upper objective, that level get exceeded by a few points, saw some profit taking and managed to close at decent levels.
Our previous upside objective for the SP was at 1038.50, so that index that managed to come back from the last sell off attempt may struggle against that resistance area for the next couple of days, two consecutive closes above the 1040.00 level may indicate another up leg that easily could push the index up to the 1060.00-1078.00 area, if that happens, the Dow will be facing the 10000 level.
In think that this slow uptrend will continue, the 1038.50 area on the SP and another test of the 1675.00 level on the NQ may be in the cards for today’s trading session, but as yesterday I don’t expect a huge move, more back and forth action with a slightly bullish bias, however, some selling may be seen once the SP trades below 1028.00-1027.00, the real selling will appear only if the SP breaks below the 1018.50 level.
TODAY’S SESSION
There is resistance at 1029.50-1031.00 on the SP, 1668.00-1670.00 on the Nasdaq and 584.10-585.60 on the Russell, trading above them will indicate a test of 1032.50-1034.50 on the SP, 1676.00-1678.00 on the Nasdaq and 588.00-589.60 on the Russell. If those get exceeded look for the markets to push higher as short covers giving way to an upside move that may reach 1037.50-1038.50 on the SP, 1684.00-1685.50 on the Nasdaq and 591.90-593.20VVVV on the Russell before the session is over, if those get violated on the SP, avoid any short position.
Initial support at 1025.50-1025.00 on the SP, 1661.50-1659.00 on the Nasdaq and 579.40-578.80 on the Russell, if those do not hold, expect some profit taking that may reach 1023.00-1021.50 on the SP, 1656.00-1655.00 on the Nasdaq and 576.10-575.20 on the Russell. Failing there will probably result in a negative session after the main indexes test the KEY short term support areas at 1018.00-1017.00 on the SP, 1650.00-1649.00 on the Nasdaq and 573.10-572.50 on the Russell. GOOD LUCK.
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TODAY’S SUPPORT, PIVOT AND RESISTANCE LEVELS |
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|
S&P |
NASDAQ |
RUSSELL |
|
Resistance 4 |
1042.00-1044.00 |
1692.00-1694.00 |
596.80-597.50 |
|
Resistance 3 |
1037.50-1038.50 |
1684.00-1685.50 |
591.90-593.20 |
|
Resistance 2 |
1032.50-1034.50 |
1676.00-1678.00 |
588.00-589.60 |
|
Resistance 1 |
1029.50-1031.00 |
1668.00-1670.00 |
584.10-585.60 |
|
PIVOT |
1025.00 |
1661.00 |
579.70 |
|
Support 1 |
1025.50-1025.00 |
1661.50-1659.00 |
579.40-578.80 |
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Support 2 |
1023.00-1021.50 |
1656.00-1655.00 |
576.10-575.20 |
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Support 3 |
1018.00-1017.00 |
1650.00-1649.00 |
573.10-572.50 |
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Support 4 |
1013.00-1011.00 |
1642.00-1641.00 |
567.20-566.00 |
|
S&P |
NASDAQ |
RUSSELL |
|
FIBONACCI |
FIBONACCI |
FIBONACCI |
|
1104.00 |
1808.63 |
659.5 |
|
1076.26 |
1757.22 |
631.6 |
|
1059.26 |
1725.72 |
614.5 |
|
1048.75 |
1706.25 |
603.9 |
|
1042.26 |
1694.22 |
597.4 |
|
1031.75 |
1674.75 |
586.8 |
|
1025.26 |
1662.72 |
580.3 |
|
1023.25 |
1659.00 |
578.3 |
|
1021.24 |
1655.28 |
576.2 |
|
1014.75 |
1643.25 |
569.7 |
|
1004.24 |
1623.78 |
559.1 |
|
997.75 |
1611.75 |
552.6 |
|
987.24 |
1592.28 |
542.0 |
|
970.24 |
1560.78 |
524.9 |
|
942.50 |
1509.38 |
497.0 |
|
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DAILY PROJECTIONS |
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S&P |
NASDAQ |
RUSSELL |
|
|
AS DAILY HIGH |
|
1038.25 |
1685.00 |
593.20 |
|
|
AS DAILY LOW |
|
1021.00 |
1653.00 |
576.10 |
