Yesterday saw most of the majors close at the R3 pivot after a closing bull charge of likely short seller covering. Today may be more of a test of the market’s true feelings as early poop and scoop action has morphed into a run to the PP (baseline) pivot.
Many traders neglect the incredible power of the pivot levels to guide their trading but in my toolbox they are among the top 5 indicators for reliability, especially for the indices and the Lazy Man components, We are getting some Volume BUZZ today focused on GLD and GDX which are also displaying the best 5 day price trend of the bunch..next to VXX, which, because of it’s beta (-2.89), belongs in a class by itself. EEM is the weak sector at the open, reflecting ongoing uncertainty about European stability (also note highly correlated XLF weakness).
After yesterday’s remarkable strength a PP narrow range day is the most probable scenario today with a possible closing surge ahead of the jobs program unveiling tonight. Nobody wants to get left behind.
