DAILY TRADING ADVISORY 30-December-2008
Investors focus on after- Christmas sales and the Israeli retaliation attacks on the Gaza strip. Crude oil trades higher on Middle East conflict. Wall Street stumbled on Monday but managed to close with moderate loses after a joint venture between Kuwait and Dow Chemical fell through, threatening one of the larger merger deals of the year and adding to fears about a faltering global economy. GMAC receives $5 billion in bailout funds.
ECONOMIC DATA
10:00 AM Consumer Confidence
YESTERDAY’S MARKET
A quite Globex session resulted in a slightly positive opening for the futures indexes. The E-mini SP started the session at 870.00 from where it bounced to 871.00, then the SP traded on a narrow range as volumes continued to be extremely light. As the Nasdaq and Russell started to push lower, the SP pulled down to 866.00, bounced a point and continued to push lower reaching the Globex lows at 860.50. As the trading session continued, the SP tried to hold above the 860.50 area but failed and made a new low at 858.25. After holding above that level, the SP posted a new marginal low at 857.25 from where it made another attempt to break higher. After failing ton trade above our updated intraday resistance at 862.00, the index moved lower posting a new low at 853.25. With trading volumes continuing to be ultra light, the SP bounced to 858.50 but failed to break higher backing off once more to 855.00 where it held and pushed higher in another bouncing attempt. The SP reached 859.00 and then traded on a two point range before breaking higher reaching 864.75 from where it pulled back to our updated support at 858.00 just to get bought showing muscles and a volume increase during the last half hour of the session that resulted in a late rally that moved all the way up to 871.50. For the day, the SP added 1.50 points closing the session at 870.50, the Nasdaq lost 13.00 points ending at 1175.50 and the Russell ended lower by 5.40 and settled at 468.50. The Dow lost 31 points ending the session at 8483.
MARKET COMMENTARY AND OUTLOOK
Yesterday I wrote:” On the short term, last week trading action has continued to respect the current ranges and the triangle formation, and if we don’t get a big breakout during this week, it’s only because the low volumes do not allow it, but be sure that we are near the next sizeable move. So until that breakout happens, trading both sides of the markets should be the way to go, of course be aware of a directional move or a trend session. This time of the year, and the low volumes favor the long side, so if the markets break above our first or second resistance levels, stop trading from the short side as the few short players could be covering to offset their positions. It is very important to take into account that most of the professional and high volume traders will not be participating in the markets until next week, so if you are on vacation, there is not rush to jump into the markets.”
On extremely low volumes that only picked up into the close, markets started the day with notorious weakness dropping precisely to the current support levels before bouncing into the close. The indexes keep holding the current ranges that run between 850.00-920.00 on the SP and 8400-9000 on the Dow. Yesterday’s trading action and the late rally may indicate that another test of the high boundary of the current ranges may be in the cards, and, if today, after the release of the Consumer Confidence data, that traders expect to show a slightly increase from last month, the markets are able to hold, we could see a positive session in front of the end of the year. I wrote yesterday that low trading volumes favor the long side of the markets, and yesterday’s late rally should offer support for some upside movement and higher prices for the rest of the week, however, making predictions with such low volumes and lack of liquidity could be premature. Remember that the 881.25 area on the SP should offer strong resistance, but once it gets cleared chances for a late Christmas rally that could reach the 900.00-920.00 areas on the SP will get increased. Of course more movement should be seen within this wide range until a solid breakout occurs and traders should remain aware that volumes.
I would like to see the Nasdaq leading the upside move, as that index may be ready to try and move higher after being trading with extremely weakness during the last seven days.
So, for today’s trading session I will favor the long side of the markets despite the fact that trading action could be jumpy, but I can not rule out an uptrend session if the SP can hold our pivot point during the first hour of the session.
TODAY’S SESSION
There is resistance at 872.50-874.00 on the SP, 1178.00-1179.00 on the Nasdaq and 470.10-471.80 on the Russell. Holding above them will indicate a test of the next resistance areas at 877.00-878.25 on the SP, 1183.00-1185.00 on the Nasdaq and 473.90-475.00 on the Russell. If the rally does not fail there, expect a test of the KEY resistance levels at 881.50-882.50 on the SP, 1191.00-1993.00 on the Nasdaq and 477.20-478.50 on the Russell. If the SP manages to close above that level we could see the 900.00 area or higher before the week is over.
There is support at 868.00-866.50 on the SP, 1171.00-1170.00 on the Nasdaq and 466.60-465.20 on the Russell. If those can hold during the first 60 minutes of the session, we could have an uptrend day, so being long above those areas could result in a good long position, but if markets area weak another test of yesterday’s intraday pivots at 863.50-861.75 on the SP, 1166.00-1164.00 on the Nasdaq and 4652.10-460.50 on the Russell may be seen before some buying appears. If those levels get violated, then only a late correction, as the one that we saw during yesterday’s last hour of the session will help the markets to avoid a possible test of yesterday’s lows. GOOD LUCK.
TODAY’S SUPPORT, PIVOT AND RESISTANCE LEVELS
S&P NASDAQ RUSSELL
Resistance 4 886.00-887.50 1197.00-1198.00 482.80-484.20
Resistance 3 881.50-882.50 1191.00-1193.00 477.20-478.50
Resistance 2 877.00-878.25 1183.00-1185.00 473.90-475.00
Resistance 1 872.50-874.00 1178.00-1179.00 470.10-471.80
PIVOT 865.75 1176.50 467.40
Support 1 868.00-866.50 1171.00-1170.00 466.60-465.20
Support 2 863.50-861.75 1166.00-1164.00 462.10-460.50
Support 3 858.00-856.50 1157.00-1155.50 458.10-456.40
Support 4 847.50-845.50 1145.00-1144.00 449.80-447.60
S&P NASDAQ RUSSELL
FIBONACCI FIBONACCI FIBONACCI
906.26 1265.55 504.50
901.49 1255.70 500.30
893.75 1239.75 493.50
886.01 1223.80 486.70
881.24 1213.95 482.50
873.50 1198.00 475.70
865.76 1182.05 468.90
863.38 1177.13 466.80
860.99 1172.20 464.70
853.25 1156.25 457.90
845.51 1140.30 451.10
840.74 1130.45 446.90
833.00 1114.50 440.10
825.26 1098.55 433.30
820.49 1088.70 429.10
DAILY PROJECTIONS S&P NASDAQ RUSSELL
AS DAILY HIGH 882.00 1186.50 472.10
AS DAILY LOW 861.50 1145.00 454.30
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
Investors focus on after- Christmas sales and the Israeli retaliation attacks on the Gaza strip. Crude oil trades higher on Middle East conflict. Wall Street stumbled on Monday but managed to close with moderate loses after a joint venture between Kuwait and Dow Chemical fell through, threatening one of the larger merger deals of the year and adding to fears about a faltering global economy. GMAC receives $5 billion in bailout funds.
ECONOMIC DATA
10:00 AM Consumer Confidence
YESTERDAY’S MARKET
A quite Globex session resulted in a slightly positive opening for the futures indexes. The E-mini SP started the session at 870.00 from where it bounced to 871.00, then the SP traded on a narrow range as volumes continued to be extremely light. As the Nasdaq and Russell started to push lower, the SP pulled down to 866.00, bounced a point and continued to push lower reaching the Globex lows at 860.50. As the trading session continued, the SP tried to hold above the 860.50 area but failed and made a new low at 858.25. After holding above that level, the SP posted a new marginal low at 857.25 from where it made another attempt to break higher. After failing ton trade above our updated intraday resistance at 862.00, the index moved lower posting a new low at 853.25. With trading volumes continuing to be ultra light, the SP bounced to 858.50 but failed to break higher backing off once more to 855.00 where it held and pushed higher in another bouncing attempt. The SP reached 859.00 and then traded on a two point range before breaking higher reaching 864.75 from where it pulled back to our updated support at 858.00 just to get bought showing muscles and a volume increase during the last half hour of the session that resulted in a late rally that moved all the way up to 871.50. For the day, the SP added 1.50 points closing the session at 870.50, the Nasdaq lost 13.00 points ending at 1175.50 and the Russell ended lower by 5.40 and settled at 468.50. The Dow lost 31 points ending the session at 8483.
MARKET COMMENTARY AND OUTLOOK
Yesterday I wrote:” On the short term, last week trading action has continued to respect the current ranges and the triangle formation, and if we don’t get a big breakout during this week, it’s only because the low volumes do not allow it, but be sure that we are near the next sizeable move. So until that breakout happens, trading both sides of the markets should be the way to go, of course be aware of a directional move or a trend session. This time of the year, and the low volumes favor the long side, so if the markets break above our first or second resistance levels, stop trading from the short side as the few short players could be covering to offset their positions. It is very important to take into account that most of the professional and high volume traders will not be participating in the markets until next week, so if you are on vacation, there is not rush to jump into the markets.”
On extremely low volumes that only picked up into the close, markets started the day with notorious weakness dropping precisely to the current support levels before bouncing into the close. The indexes keep holding the current ranges that run between 850.00-920.00 on the SP and 8400-9000 on the Dow. Yesterday’s trading action and the late rally may indicate that another test of the high boundary of the current ranges may be in the cards, and, if today, after the release of the Consumer Confidence data, that traders expect to show a slightly increase from last month, the markets are able to hold, we could see a positive session in front of the end of the year. I wrote yesterday that low trading volumes favor the long side of the markets, and yesterday’s late rally should offer support for some upside movement and higher prices for the rest of the week, however, making predictions with such low volumes and lack of liquidity could be premature. Remember that the 881.25 area on the SP should offer strong resistance, but once it gets cleared chances for a late Christmas rally that could reach the 900.00-920.00 areas on the SP will get increased. Of course more movement should be seen within this wide range until a solid breakout occurs and traders should remain aware that volumes.
I would like to see the Nasdaq leading the upside move, as that index may be ready to try and move higher after being trading with extremely weakness during the last seven days.
So, for today’s trading session I will favor the long side of the markets despite the fact that trading action could be jumpy, but I can not rule out an uptrend session if the SP can hold our pivot point during the first hour of the session.
TODAY’S SESSION
There is resistance at 872.50-874.00 on the SP, 1178.00-1179.00 on the Nasdaq and 470.10-471.80 on the Russell. Holding above them will indicate a test of the next resistance areas at 877.00-878.25 on the SP, 1183.00-1185.00 on the Nasdaq and 473.90-475.00 on the Russell. If the rally does not fail there, expect a test of the KEY resistance levels at 881.50-882.50 on the SP, 1191.00-1993.00 on the Nasdaq and 477.20-478.50 on the Russell. If the SP manages to close above that level we could see the 900.00 area or higher before the week is over.
There is support at 868.00-866.50 on the SP, 1171.00-1170.00 on the Nasdaq and 466.60-465.20 on the Russell. If those can hold during the first 60 minutes of the session, we could have an uptrend day, so being long above those areas could result in a good long position, but if markets area weak another test of yesterday’s intraday pivots at 863.50-861.75 on the SP, 1166.00-1164.00 on the Nasdaq and 4652.10-460.50 on the Russell may be seen before some buying appears. If those levels get violated, then only a late correction, as the one that we saw during yesterday’s last hour of the session will help the markets to avoid a possible test of yesterday’s lows. GOOD LUCK.
TODAY’S SUPPORT, PIVOT AND RESISTANCE LEVELS
S&P NASDAQ RUSSELL
Resistance 4 886.00-887.50 1197.00-1198.00 482.80-484.20
Resistance 3 881.50-882.50 1191.00-1193.00 477.20-478.50
Resistance 2 877.00-878.25 1183.00-1185.00 473.90-475.00
Resistance 1 872.50-874.00 1178.00-1179.00 470.10-471.80
PIVOT 865.75 1176.50 467.40
Support 1 868.00-866.50 1171.00-1170.00 466.60-465.20
Support 2 863.50-861.75 1166.00-1164.00 462.10-460.50
Support 3 858.00-856.50 1157.00-1155.50 458.10-456.40
Support 4 847.50-845.50 1145.00-1144.00 449.80-447.60
S&P NASDAQ RUSSELL
FIBONACCI FIBONACCI FIBONACCI
906.26 1265.55 504.50
901.49 1255.70 500.30
893.75 1239.75 493.50
886.01 1223.80 486.70
881.24 1213.95 482.50
873.50 1198.00 475.70
865.76 1182.05 468.90
863.38 1177.13 466.80
860.99 1172.20 464.70
853.25 1156.25 457.90
845.51 1140.30 451.10
840.74 1130.45 446.90
833.00 1114.50 440.10
825.26 1098.55 433.30
820.49 1088.70 429.10
DAILY PROJECTIONS S&P NASDAQ RUSSELL
AS DAILY HIGH 882.00 1186.50 472.10
AS DAILY LOW 861.50 1145.00 454.30
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