TradeStalker's
R.B.I. Trader's Update
12 / 16 / 2008
(Published Since 1996)
...............................................
Dateline: 6:58 pm eastern time, 12/16/2008
The market opened higher on Tuesday, but the early strength
reversed after getting just over the 884.00-884.50
resistance on the ES and it backed off from 885.25 to test
the opening low. The 877.25 level was bought and the market
went back to token higher highs before the Fed release.
After the release the ES popped to the 893-894 zone and
quickly dropped back to 885.50 and then turned back up. The
900 level was rejected on the first good run-up, and the ES
dropped to 887.00 and again reversed back up. The ES
sprinted to the 912.50-913.50 and that move lost juice and
brought in a pullback to the 904.00 level. Another turn back
up took the averages back to test the highs with the ES
getting to 915.00 before backing off into the close.
The market put together a good rally that finally stuck on
Tuesday. In the process, a few indicators jumped into
overbought territory. It is not across the board extremes
like we have seen before some of the bigger drops recently,
but the market could have a bit of trouble holding on to
gains on Wednesday. We will likely see some two-sided
action, but as long as the pullbacks are well contained, the
ES could be heading for the 926.75-928.00 area for the first
big test of the market's strength. If the ES gets up there,
and then the move reverses, it could set up a fairly sharp
drop. In fact, if we get there all everything lines up, it
could be an end to this rally off of the lows and set up a
January drop. We'll see if that shapes up or not fairly soon
it appears.
On Wednesday look for a shorting opportunity if there is an
early pop up to the initial resistance areas and the move
reverses. If that plays out in the early going, beware that
the first decent pullback should set up a good buying
opportunity. It looks like a drop could go as far as the
899.75-898.75 area before any real damage occurs. If there
is a drop to that area on Wednesday, it will need to be
quickly reversed, otherwise a short term high could be in
place.
The initial resistance is at the 914.50-915.00 area on the
SP futures and 1247.50-1248.75 area on the Nasdaq futures.
If the market doesn't hesitate there and keeps on going on
the upside, then a move towards the 919.25-920.00 area on
the SP futures and 1252.50-1254.00 area on the Nasdaq
futures could be in the works. If the market gets up there,
and the move reverses, it should offer a good shorting
opportunity. If those areas do not cause a reaction, and are
exceeded, then the 926.75-928.00 area on the SP futures and
1261.50-1263.50 area on the Nasdaq futures would be key
areas on Wednesday. A reversal from that zone could be the
start of another sizable leg on the downside. However, if
those are not a problem, then a move to the 934.50-935.00
area on the SP futures and 1270.50-1272.00 area on the
Nasdaq futures is probably in the cards. If the market gets
wings and the upside gets a head of steam, then a rally
towards the 949.50-950.50 area on the SP futures [9248-9254]
and 1300.50-1302.00 area on the Nasdaq futures is possible.
The initial support is at the 904.50-904.00 area on the SP
futures and 1231.50-1230.50 area on the Nasdaq futures. If
the market pulls back there early on Wednesday, and the
market turns back up, it should be a gift on the long side.
If the market drops down there and can not turn back up,
then a pullback to the 899.75-898.75 area on the SP futures
and 1228.50-1227.50 area on the Nasdaq futures will need to
hold. If those areas are not defended, then the 892.25-
892.50 area on the SP futures and 1218.75-1217.50 area on
the Nasdaq futures could be in the cards. If the market
doesn't turn around from there, then key support is at the
885.75-884.75 area on the SP futures and 1213.50-1212.50
area on the Nasdaq futures. A pullback should not break
those areas. If it is broken, then it look like the 880.25-
879.75 area on the SP futures would need to hold, otherwise
the market is back in the trading range and in some trouble.
March 2009 SP futures resistance
symbols: emini = esh9 / big contract =sph9
914.50-915.00
919.25-920.00
926.75-928.00
934.50-935.00
949.50-950.50
March 2009 SP futures support
symbols: emini = esh9 / big contract =sph9
904.50-904.00
899.75-898.75
892.25-892.50
885.75-884.75
880.25-879.75
March 2009 Nasdaq futures resistance
symbols: emini = nqh9 / big contract = ndh9
1247.50-1248.75
1252.50-1254.00
1261.50-1263.50
1270.50-1272.00
1300.50-1302.00
March 2009 Nasdaq futures support
symbols: emini = nqh9 / big contract = ndh9
1231.50-1230.50
1228.50-1227.50
1218.75-1217.50
1213.50-1212.50
March 2009 Dow futures resistance
symbols: emini = ymh9
8932-8938
9000-9005
9074-9080
9118-9122
9248-9254
March 2009 Dow futures support
symbols: emini = ymh9
8852-8847
8811-8804
8744-8739
8674-8666
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This publication's primary focus is trading the index
futures. However, you can also use my nightly updates to
trade the following ETF's (SPY), (QQQQ), (SDS), (QID),
(DIA), and (DOG)
REMINDER:
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http://www.tradestalker.com/members
---------------------------
Good Trading,
Mike Reed
Copyright (c) 2008 by TradeStalker.com, Ft Wayne, IN.
TradeStalker Updates may not be redistributed without
permission.
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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
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is substantial. You can lose more than your original
investment. We are not Registered Investment Advisors or
Commodity Trading Advisors.
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