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TradeStalker's
R.B.I. Trader's Update
4/23/2007
(Published Since 1996)
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Dateline: 6:12 pm eastern time, 4/23/2007
After opening lower, the market moved up to initial resistance and then reversed. Off of a 1494.75 high on the SP futures, they fell 3.25 points to 1491.50 and then the market went sideways. While the Nasdaq futures made a test of its early high, the SP futures had a lid on top at 1494.00 and the market backed off. By 2 pm the SP futures reached 1487.00 while the Nasdaq futures fell to 1856.75 and after a pop they went back to test the lows. Buying came in on that test and a rally back to 1490.75 on the SP futures followed. However, with 30 minutes left in stock trading,the market had stalled long enough at that 1490.75 level and the blue chips sold off into the close.
On Tuesday we get the Consumer Confidence and Existing Home Sales releases at 10 am. The 1493.75-1494.75 area on the SP futures was trouble on Monday, but the pullback didn't have much gusto. The VIX jumped 8% on Monday and that big of a move on a fairly calm day is normally short term bullish. At least, the market is expecting a pick-up in volatility.
Up at these levels, there likely isn't a whole lot more on the upside. The last part of the rally was very thin, with breadth and volume indicators not confirming the new highs.On the downside, the SP futures could sell off as far as the1461.50-1461.00 area without destroying the current uptrend. Shorting the rallies that stall out should offer the easier trade setups.
That said, if there is early weakness, then be on alert fora reversal to get long. Just be careful not to overstay your welcome. On the other side of the coin, if the market opens higher and the move fizzles (especially near that 1493.75-1494.75 area on the SP futures again), then it should offer a decent trade on the short side. Thereafter, if the market can establish a trend, then go with that trend with an eye on resistance / support areas for a potential turn.
Good Trading,
Mike Reed
Get my nightly support and resistance zones that I'll be buying and selling against the following trading day along with my bullish or bearish outlook for the next day's market action. Yes, we have a FREE TRIAL!
http://www.tradestalker.com/
Monday, April 23, 2007
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