Dateline: 5:54 pm Eastern time, 05/03/2006
The market opened lower on Wednesday and the selling didn't
let up until about 40 minutes into the trading day. The
market bounced back a bit, but the SP futures had trouble at
old 1314.50 support (turned resistance) and the selling
resumed. By late morning, the SP futures reached 1309.75 and
the Nasdaq futures went to 1693.00, and a feeble bounce
followed. Wedge patterns formed on the intraday charts and
once broken on the down side, the market dove to the
1308.50-1307.50 area on the SP futures and/or the 1689.75-
1688.25 area on the Nasdaq futures. With 90 minutes left in
stock trading, the SP and Nasdaq futures reached 1308.00 and
1687.75, respectively. We were on alert for a reversal from
support there and the market obliged by bouncing to 1313.50
on the SP futures and 1698.25 on the Nasdaq before softening
into the close.
The market is acting like it could get knocked over pretty
easily. The SP500 has refused to break out and now rallies
aren't sticking. We could remain range bound until Friday,
but odds are still better shorting the bounces as soon as
they fizzle.
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Good Trading,
Mike Reed
Wednesday, May 03, 2006
Market Comment 5/02/06
The market opened higher on Tuesday, then sold off for about
40 minutes. The dip was bought and the market chopped higher
into early afternoon. The SP futures found difficulty around
its 1318.00-1318.50 resistance while the Nasdaq waffled
around its 1705.00 resistance level, and the market sold off
grudgingly until the last hour of trading. The SP futures
made it back to test the high while the Nasdaq sagged lower
into the close.
If there is follow through buying early on Wednesday, be on
alert for a reversal after the first 20-40 minutes of
trading. Thereafter, if the market obliges and we get a sell
off, look for that first drop to be met with buying as soon
as the momentum fizzles. We should have more back and forth
type of trading action until all of the averages get in
sync.
Good Trading,
Mike Reed
40 minutes. The dip was bought and the market chopped higher
into early afternoon. The SP futures found difficulty around
its 1318.00-1318.50 resistance while the Nasdaq waffled
around its 1705.00 resistance level, and the market sold off
grudgingly until the last hour of trading. The SP futures
made it back to test the high while the Nasdaq sagged lower
into the close.
If there is follow through buying early on Wednesday, be on
alert for a reversal after the first 20-40 minutes of
trading. Thereafter, if the market obliges and we get a sell
off, look for that first drop to be met with buying as soon
as the momentum fizzles. We should have more back and forth
type of trading action until all of the averages get in
sync.
Good Trading,
Mike Reed
Market Comment 5/01/06
Dateline: 7:36 pm Eastern Time, 5/1/2006
The market opened higher on Monday, and ran up to 1322.25 on
the SP futures and 1719.75 on the Nasdaq futures in the
first 15 minutes of trading. A quick dip and retest failed,
and the downside took hold. The SP futures held at 1316.50
while the Nasdaq futures stopped at 1709.50, and then the
market went into churn mode. Shortly after 3 pm, the SP
futures popped over 1320.00 and then reversed hard. The
afternoon ranges broke, and the market hit an air pocket, as
the market was hit with waves of selling into the closing
bell.
We have yet another failure at the 1322-1324 area on the SP
futures. The bounces should be countertrend affairs for now.
The futures settled with very small premiums, so an early
selloff that reverses could set up a trade on the long side
early on Tuesday. Aside from that occurring, shorting the
bounces then as soon as the upside stalls should offer very
good shorting opportunities - especially at a good
resistance zone.
Good Trading,
Mike Reed
The market opened higher on Monday, and ran up to 1322.25 on
the SP futures and 1719.75 on the Nasdaq futures in the
first 15 minutes of trading. A quick dip and retest failed,
and the downside took hold. The SP futures held at 1316.50
while the Nasdaq futures stopped at 1709.50, and then the
market went into churn mode. Shortly after 3 pm, the SP
futures popped over 1320.00 and then reversed hard. The
afternoon ranges broke, and the market hit an air pocket, as
the market was hit with waves of selling into the closing
bell.
We have yet another failure at the 1322-1324 area on the SP
futures. The bounces should be countertrend affairs for now.
The futures settled with very small premiums, so an early
selloff that reverses could set up a trade on the long side
early on Tuesday. Aside from that occurring, shorting the
bounces then as soon as the upside stalls should offer very
good shorting opportunities - especially at a good
resistance zone.
Good Trading,
Mike Reed
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