TradeStalker's RBI Update 01/05/10

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TradeStalker's

R.B.I. Trader's Update

1 / 5 / 2010

(Published Since 1996)

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Dateline: 6:16 pm eastern time, 1/5/2010

The opening strength on Tuesday was a short from the 1129.75-1130.50 resistance on the ES, and it fell to 1125.00 and quickly reversed. The ES then sprinted to 1132.75, but after the rally fizzled, a 1-2-3 top formed after the 1131.75 lower high reversed. The downside target/support at the 1126.50-1126.00 area was nailed. The market turned back up, and the rally was verified as 1129.50 broke/held and it was good for a rally back to 1133.00 by the close.

The market might continue to push higher, but at these levels there should be a pullback first. The indicators are getting short term overbought, and the VIX closed at its lowest level since the 2007 top. The Monday afternoon lows now need to hold, or quickly reverse if broken, to avoid a topping pattern. Unless that occurs, the moves to new highs that stalls/reverses should set up shorting opportunities and the pullbacks that are quickly reversed should set up trades on the long side. Don't get carried away with longs as the reward/risk doesn't look real favorable short term.

March 2010 SP futures resistance
symbols: emini = esh0 / big contract =sph0

1132.50-1133.00
1135.75-1136.50
1141.00-1143.00

March 2010 SP futures support
symbols: emini = esh0 / big contract =sph0

1130.00-1129.50
1126.00-1125.00
1122.00
1120.50-1119.50


March 2010 Nasdaq futures resistance
symbols: emini = nqh0 / big contract = ndh0

1889.50-1890.25
1894.00-1894.50
1900.50-1904.50

March 2010 Nasdaq futures support
symbols: emini = nqh0 / big contract = ndh0

1883.50-1883.00
1877.00-1876.00
1871.50
1868.50-1867.75


March 2010 Dow futures resistance
symbols: emini = ymh0

10522-10528
10554-10558
10611-10616

March 2010 Dow futures support
symbols: emini = ymh0

10494-10490
10461-10455
10425
10401-10399

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Good Trading,
Mike Reed
TradeStalker.com

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