TradeStalker's
R.B.I. Trader's Update
2 / 26 / 2009
(Published Since 1996)
...............................................
Dateline: 6:53 pm eastern time, 2/26/2009
The market opened higher on Thursday, but the strength was
sold and the market dropped for about 20 minutes before
turning back up. The move took the ES to the 779.00-779.50
resistance, and the ES backed off from 779.00. After the
dip, the ES popped up to 778.00 and then turned back down.
That triggered another 1-2-3 top pattern and the ES dropped
to the 760.50-760.00 support zone. Buying came in, but the
ES fizzled just under the updated 773 resistance (and at the
60ema on the 5 minute chart) and a drop to the 752.00-751.25
zone was underway. The ES reached 750.25 and then reversed,
but the bounce fizzled at 758.50 (and the 20ema) and the
market dropped back to its lows at the close.
The complacency at these levels is hard to believe. The Vix
dropped 10% under its 10 day average close intraday, and
still closed down while the market was down pretty hard. It
gave a sell signal on Thursday. The Put/Call ratio isn't sky
high either, like it has been at past good lows.
At the moment, it is back to range-bound trading. The SP500
has been in a range for 5 days now, with 780.12 being the
top side and 742.37 being the bottom side. The top of the
range was rejected the past 2 days, as the bounces refuse to
stick. A break to the downside will likely stick, given the
lack of fear in the air, and if that happens then we could
see the ES drop under 700 for the first time in over a
decade. A drop towards the 680 level is possible if the 5
day range is broken on a closing basis. That would shake up
the complacent group of options traders.
We had a drop of 600+ points on the Dow on February 27th a
few years ago. Don't count on that, but it does look like
the market has more to go on the downside. It will take a
break and hold over the 758.00-758.50 area on the ES (or the
60 period ema on the 5 minute chart) to put a dent in the
downside momentum, and the market is a short under the
initial resistance areas. If there is a test of the weekly
low at the 739.75-739.00 zone on the ES, and it is not
quickly reversed, then the bottom of the range is broken and
the downside could pick up steam.
On Friday, look for early strength to be sold as soon as the
upside momentum fizzles. If that plays out, and the ES
breaks and holds under the 750 level, it could be worth
holding on to with a trailing stop. If the bottom of the
range, and last year's low, is not held on the SP500 cash
and futures, then it could be a bad Friday for those long.
However, if the ES drops towards the 740-739 area and
reverses with some gusto, then buying pullbacks will be in
order. Just be careful with the long side, as the market has
a strong trend and momentum on the downside.
March 2009 SP futures resistance
symbols: emini = esh9 / big contract =sph9
758.00-758.50
760.50
767.25-767.75
771.50-772.25
779.00-779.50
785.50-786.00
March 2009 SP futures support
symbols: emini = esh9 / big contract =sph9
750.50-750.00
747.50-747.00
739.75-739.00
732.00-731.50
March 2009 Nasdaq futures resistance
symbols: emini = nqh9 / big contract = ndh9
1138.00-1138.50
1142.00
1151.75-1153.00
1162.50-1163.50
1173.50-1175.00
1180.50-1181.50
March 2009 Nasdaq futures support
symbols: emini = nqh9 / big contract = ndh9
1127.50-1126.50
1122.20-1121.50
1116.25-1115.00
1107.25-1106.50
March 2009 Dow futures resistance
symbols: emini = ymh9
7226-7230
7250
7303-7307
7333-7336
7387-7393
7441-7446
March 2009 Dow futures support
symbols: emini = ymh9
7160-7155
7128-7124
7058-7052
7011-7007
---------------------------
REMINDER:
Real Time subscribers can view these updates on
the web at this site:
http://www.tradestalker.com/members
---------------------------
Good Trading,
Mike Reed
Copyright (c) 2009 by TradeStalker.com, Ft Wayne, IN.
TradeStalker Updates may not be redistributed without
permission.
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)
www.TradeStalker.com
PO Box 9783, Ft Wayne, IN, 46899
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.
*************************************************
No comments:
Post a Comment