TradeStalker's
R.B.I. Trader's Update
9 / 30 / 2008
(Published Since 1996)
...............................................
Dateline: 6:28 pm eastern time, 9/30/2008
Reminiscent of the day after the 1987 crash, the market put
together a huge rally on Tuesday. The market opened higher
and after a 10 point pullback from 1142.00 on the ES the
market headed higher. A run towards the 1155.00-1156.00 area
on the ES stalled, and the market pulled back. However, the
market held together as the updated support at the 1243
level was reversed and the market finally broke out of that
10 point trading range to the upside. The 1156.00 level held
on a pullback and the rally reversed briefly after getting
to the 1266.75 level. Buying came in and the market reversed
off of 1159.00 on the ES and the trend-up action continued
into the close for stocks. After the bell, the SP futures
pulled back about 10 points before settlement.
This is looking similar to the September 18th rally day in
that the daily indicators went from deeply oversold to
overbought in a day. The following day, the 19th, the market
also put together a good rally, and then the market began
the last downtrend. Although Tuesday was an "inside day" for
the cash indices, we still had a trend up day. Back to back
trend days are not common, so Wednesday should be more of a
back and forth type of day.
On Wednesday the market will be in a "buy the dip" mood
unless/until there is a break below the initial support at
the 1159.50-1159.00 area on the SP futures and the 1578.50-
1577.00 area on the Nasdaq futures. If there is early
strength, it should set up a good shorting opportunity if
the move fizzles and reverses in the first 15 minutes or so.
If that plays out, beware that the first decent pullback
will likely be reversed and will set up a buying opportunity
when that occurs. However, if a pullback breaks the initial
support and doesn't bounce right back, then things are
likely changing and the downside could go as far as the
1143.00-1142.50 area on the SP futures before buying comes
in. If that area doesn't hold, then things are getting bad
again.
The initial resistance is at the 1175.50 level on the SP
futures and the 1605.75 level on the Nasdaq futures. If the
market pops up there early and reverses, then a shorting
opportunity could set up. If the market pops up there and
doesn't hesitate breaking through those areas, then we
should go for the 1180.25-1181.00 area on the SP futures and
the 1610.50-1612.00 area on the Nasdaq futures. If the
market doesn't reverse off of those areas, then the upside
could extend towards the 1188.00-1189.00 area on the SP
futures and the 1620.00-1621.00 area on the Nasdaq futures.
If those are exceeded, then a run towards the 1194.50-
1195.00 area on the SP futures and the 1628.00-1630.00 area
on the Nasdaq futures will be next.
The initial support is at the 1159.50-1159.00 area on the SP
futures and the 1578.50-1577.00 area on the Nasdaq futures.
If a pullback can hold those areas and turn up, it sets up a
good trade on the long side. However, if those are broken
and not quickly reversed, then a drop towards the 1156.00-
1155.50 area on the SP futures and the 1570.25-1568.75 area
on the Nasdaq futures could be in the cards. Those would be
key support areas and the market shouldn't fall any further
if things are still okay. If those are not defended, then it
opens the door for a drop towards the 1143.00-1142.50 area
on the SP futures and the 1557.00-1555.75 area on the Nasdaq
futures. If those don't hold, then another big down day is
possible.
December 2008 SP futures resistance
symbols: emini = esz8 / big contract =spz8
1175.50
1180.25-1181.00
1188.00-1189.00
1194.50-1195.00
December 2008 SP futures support
symbols: emini = esz8 / big contract =spz8
1159.50-1159.00
1156.00-1155.50
1143.00-1142.50
December 2008 Nasdaq futures resistance
symbols: emini = nqz8 / big contract = ndz8
1605.75
1610.50-1612.00
1620.00-1621.00
1628.00-1630.00
December 2008 Nasdaq futures support
symbols: emini = nqz8 / big contract = ndz8
1578.50-1577.00
1570.25-1568.75
1557.00-1555.75
December 2008 Dow futures resistance
symbols: emini = ymz8
10888
10938-10944
11018-11023
11071-11078
December 2008 Dow futures support
symbols: emini = ymz8
10730-10725
10700-10692
10605-10600
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---------------------------
Good Trading,
Mike Reed
Copyright (c) 2008 by TradeStalker.com, Ft Wayne, IN.
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permission.
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Disclaimer
The financial markets are risky. Investing is risky.
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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