Economic data continue to show a little better than expected; yesterday the initial jobless claims report was encouraging. Bulls pushed the price up in the early trading, but later the same concerns about the European banks arose again after Bloomberg reported Deutsche Bank is considering selling stock to raise up to $11.4 billion. The market gave back two-thirds of the gain.
For the ES it was rollover day and most activity related to the rollover. The price on the old contract had been pushed up and the futures then sold off on the switch to the new contract around 1096 line. But little has changed and the continuation contract shows virtually no break.
The price movement is starting to look similar to the action in early August. If ES can’t breakout 1107.25 line to move to a new high today or next Monday, then the chance of a move higher could be diminished, especially if price breaks down 1080-1075 range. If that range breaks the decline could resume again.
ESZ) Daily chart
Trading strategy for September 10
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