TradeStalker's
R.B.I. Trader's Update
11 / 03 / 2008
(Published Since 1996)
...............................................
Dateline: 7:08 pm eastern time, 11/03/2008
The market opened lower on Monday, but after 20 minutes of
trading the market turned up and rallied to the 973.00-
974.00 initial resistance area on the SP futures. After
poking just over that zone to 974.50, the move quickly
reversed and the market pulled back. The 960.25 level held
on the pullback, and then the SP futures rallied back to
972.50 just after noon. The upside stalled out and another
downdraft started, and the SP futures sold off to 957.00
with about an hour left in trading. Unable to cut through
the 956.00-955.00 support area, buying and short covering
started and the market rallied back in the last hour of
trading.
On Monday the SP futures traded in the narrowest range since
a 15.50 point range on September 3rd. The market has found a
trading range at the moment, but things are beginning to
look toppy. Aside from coming off extreme overbought status,
complacency is coming into play. The VIX went to its lowest
level in the last 10 days, which is one sell signal from the
VIX. A reversal on the VIX on Tuesday would give more sell
signals. In addition to short term sentiment, the market
tends to be extremely volatile at bottoms, but on the other
side of the coin, volatility tends to dry up near tops. The
volatility was pretty much absent compared to the action of
late.
The market averages made inside days on Monday, and the
compression should soon lead to a big move. The Election
will be the excuse, but it's in the technicals as I see it.
On Tuesday look to short early strength as soon as the
upside stalls and begins to turn. This should set up in the
first 20-40 minutes if it's going to play out. If it does,
the first decent pullback will then likely set up a buying
opportunity as long as the 956.00-955.00 area on the SP
futures and 1321.00-1319.50 area on the Nasdaq futures hold.
If the market gets back there and doesn't quickly turn
itself back up, then the market could get hit fairly hard. A
drop should hold those areas, otherwise a drop to the lower
end of this trading range could be in the cards.
The initial resistance is at the 970.50 level on the SP
futures and 1343.00 level on the Nasdaq futures. If those
are cleared, then the move must easily cut through good
resistance at the 974.00-974.50 area on the SP futures and
1347.50-1348.25 area on the Nasdaq futures and not quickly
reverses in order to get something going on the upside. If
the market can pull that off, then we should see a run up to
test the 983.00-984.00 area on the SP futures and 1360.50-
1361.25 area on the Nasdaq futures. Those should be key
resistance areas if the market gets up there. If the market
is in good shape, then those areas shouldn't be a problem
and the move should take the market to the resistance at the
987.50-988.50 area on the SP futures and 1366.50-1368.00
area on the Nasdaq futures. If those areas are broken, and
not quickly reversed, then we could see a rally towards the
997.50-998.50 area on the SP futures and 1378.50-1380.25
area on the Nasdaq futures.
The first good support is at the 956.00-955.00 area on the
SP futures and 1321.00-1319.50 area on the Nasdaq futures.
If the market can not quickly reverse from those areas, then
we could see a decent shake-out to the downside. the next
key support would be at the 944.00-943.00 area on the SP
futures and 1306.00-1305.25 area on the Nasdaq futures. If
buyers can not reverse from those areas, then a bit a panic
could take the market down to the 936.00-935.50 area on the
SP futures and 1298.00-1296.50 area on the Nasdaq futures.
If those areas are reached, be on alert for a reversal.
However, if the market gets down there and can not quickly
turn back up, then there should be good support at the
927.50-926.50 area on the SP futures and 1282.50-1280.25
area on the Nasdaq futures.
December 2008 SP futures resistance
symbols: emini = esz8 / big contract =spz8
970.50
974.00-974.50
983.00-984.00
987.50-988.50
997.50-998.50
December 2008 SP futures support
symbols: emini = esz8 / big contract =spz8
956.00-955.00
944.00-943.00
936.00-935.50
927.50-926.50
December 2008 Nasdaq futures resistance
symbols: emini = nqz8 / big contract = ndz8
1343..00
1347.50-1348.25
1360.50-1361.25
1366.50-1368.00
1378.50-1380.25
December 2008 Nasdaq futures support
symbols: emini = nqz8 / big contract = ndz8
1321.00-1319.50
1306.00-1305.25
1298.00-1296.50
1282.50-1280.25
December 2008 Dow futures resistance
symbols: emini = ymz8
9341
9386-9392
9428-9435
9478-9484
9572-9579
December 2008 Dow futures support
symbols: emini = ymz8
9219-9211
9098-9091
8994-8989
8912-8904
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---------------------------
Good Trading,
Mike Reed
Copyright (c) 2008 by TradeStalker.com, Ft Wayne, IN.
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Past performance does not guarantee future performance.
The foregoing has been prepared solely for informational
purposes and is not a solicitation, or an offer to buy
or sell any security. Opinions are based on historical
research and data believed reliable, but there is no
guarantee that future results will be profitable.
We are not advocating trading futures. The prices and
contracts in the TradeStalker Updates specify a manner
in which you could trade. We occasionally mention the
SP500 and Nasdaq futures markets because it is
extremely liquid and tends to lead the other markets.
This is not an endorsement or recommendation of the SP500
and Nasdaq futures markets. The risk of loss in futures
is substantial. You can lose more than your original
investment. We are not Registered Investment Advisors or
Commodity Trading Advisors.
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