Market Comment 05/01/07 - Nightly Update

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TradeStalker's

R.B.I. Trader's Update

05 /01 / 2007

(Published Since 1996)

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Dateline: 6:34 pm Eastern time, 5/01/2007


The market opened higher on Tuesday, but that "strength" was
sold and the market sold off to test Monday's lows. After
the 10am releases, the market broke through those lows and
went down to 1482.25 on the SP futures about 60 minutes into
the trading day. A reversal off the lows got the upside
going, but the move stalled just under the updated
resistance at 1490.50-1491.25 on the SP futures, and the
market went back to test its lows. The SP futures made a
higher low, and the reversal stoked more buying. The rally
paused at the updated resistance, but then punched through
and made it to 1493.00 by 3pm. That was a 50% retracement of
the week's range and the market pulled back a bit, and then
rebounded to end the day near the highs.

The intraday patterns show "W" bottoms off the Tuesday lows.
The SP futures stopped at its 50% retracement from the
Monday high to Tuesday low. This could turn in to a wide
range, and if that's the case the SP futures settled right
in the middle of that.

The market ended the day in uptrends, so let's look for the
"sell early, buy the first decent pullback" type of pattern
in the early going. The trends will point higher as long as
the initial support is not broken. However, it looks like a
break of the initial support areas, that isn't quickly
reversed, would be a red flag.

Good Trading,
Mike Reed

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