TradeStalker's RBI Update 01/06/10

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TradeStalker's

R.B.I. Trader's Update

1 / 6 / 2010

(Published Since 1996)

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Dateline: 6:26 pm eastern time, 1/6/2010

The ES popped up to the 1132.50 on the open (1132.50-1133.00
initial resistance) and quickly dropped to 1129.75 (1130.00-
1129.50 initial support) before bouncing back. Per the 2nd
intraday update, the rest of the day was "a choppy day with
new highs sold and the pullbacks are bought. The 1135.50
high was 1 tick under important resistance and the market
backed off as expected before the close.

The market might have higher to go, but the risk/reward up
here doesn't look very favorable at the moment. The very
short term internal gauges are overbought, with my RBI
Oscillator just turning from Sell territory. Along with
that, my 3 day thrust oscillator at +.60 (normal overbought
is +/- .50). Also, the sentiment is very bullish, and as a
contrary indicator that's not a great backdrop for higher
prices. In addition to that, the Vix made back-to-back new
52 week lows on Tuesday and Wednesday. If the Vix reverses
and closes up on Thursday it could give a number of sell
signals.

That said, the market really hasn't done anything wrong just
yet, and still has an outside chance to rally towards the
1141-1143 area on the ES. It looks like the upside should be
okay as long as the 1131.50-1130.75 area is defended, along
with the 10560 level on the Dow cash. If those areas are not
held, or quickly reversed if broken, then the bounces are
not likely going to stick. In fact, if the market does put
together a rally but it stalls out in new high ground, it
should set up at least a scalp on the short side the way the
market has been acting.

We get the Initial Claims before the open on Thursday, and
on Friday we get the Employment data before the open, so
another two-sided day is expected. The short side should
give the "easier" opportunities if there is a pop to around
the Wednesday highs, or a bit higher. On a pullback, expect
a bounce to occur unless the initial support areas are
broken and not quickly reversed.

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

1135.50
1136.50-1137.00
1141.00-1143.00


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

1131.50-1130.75
1128.00
1126.00-1125.00
1122.00-1121.25


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

1890.25
1894.00-1894.50
1900.50-1904.50


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

1873.25-1872.25
1869.25
1864.50-1864.00
1858.50-1857.50


March 2010 Dow futures resistance
symbols: emini = ymh0

10544
10554-10558
10611-10616


March 2010 Dow futures support
symbols: emini = ymh0

10494-10490
10478
10461-10455
10425-10421

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Good Trading,
Mike Reed
TradeStalker.com

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