TradeStalker's
Support and Resistance Update
5 / 24 / 2011
(Published Since 1996)
...............................................
Dateline: 7:36 pm eastern time, 5/24/2011
In last night's update, members were told that the markets
were close to being oversold, but in order to rally higher,
both the ES and NQ needed to trade above and hold initial
resistance zones. The ES gapped up nearly 5 points to open
at 1319.50. An early short scalp trade opportunity presented
itself when the initial published resistance zone of
1319.50-1320.50 was rejected 7 minutes into the trading day
(after having been sold several times during the overnight
session). After the pullback, the ES spiked to a morning
high of 1322.50 around 10 AM on economic news. That high was
sold and a bounce failed, which resulted in the ES trading
down to 1315.75 (yesterday's closing bar high) by 10:40 AM.
After a failed bounce around the 1318.50 area, it set up a
good short trade, as the ES traded down to 1313.00 just
after 12:30 PM, which was in the next published zone of
1313.50-1313.00. The first test of that zone was rejected,
which setup a good long scalp trade. The market then made
several failed attempts to break above 1315.50 resistance
before reversing at a new low of 1311.50 around 1:40 PM. A
bounce then took out 1315.50 and held on a dip and a move to
the 1318.50 level (1317.50-1318.50 new key resistance)
occurred, but the ES couldn't push through and the market
rolled over and dropped to test the lows just before
settlement.
This market cannot get anything going that wants to hold,
more so on the upside. The indicators are still teetering on
getting oversold, but the price erosion is going to take
repair work. Favoring the short side after a decent move up
fizzles is still the best course of action until things
change short term.
On Wednesday look for early weakness to be bought, and if
that plays out then the first decent bounce should be sold
if the market is still weak. If that occurs and a bounce
fails again near 1315.50 on the ES, then the bulls need to
defend the 1310.25-1309.50 zone on the ES when it gets
tested. Beware of a bounce attempt from that area, but it
will need some power or it will fail again. If there is no
sign of getting a bounce from the 1310.25-1309.50 area on
the ES then the market is under pressure and could drop to
the 1300 area on the SP500 cash before a low is in place. To
get buyers back and avoid more trouble on Wednesday, a move
over the 1319.50 area is needed and must hold up there,
otherwise it's a trading range at best short term.
June 2011 SP futures resistance
symbols: emini = esm1 / big contract =spm1
1315.50
1318.25-1318.75
1322.00-1322.75
1327.50-1328.50
June 2011 SP futures support
symbols: emini = esm1 / big contract =spm1
1312.25-1312.00
1310.25-1309.50
1306.25-1305.50
1301.00-1300.50
1297.50-1296.50
June 2011 Nasdaq futures resistance
symbols: emini = nqm1 / big contract = ndm1
2305.25
2310.25-2310.75
2317.25-2318.25
2323.75-2325.00
June 2011 Nasdaq futures support
symbols: emini = nqm1 / big contract = ndm1
2299.75-2298.75
2293.25-2292.50
2286.00-2285.00
2278.50-2277.50
2270.00-2268.50
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REMINDER:
Real Time subscribers can view these updates, and also get
real time instant messages, on the web at this site:
http://www.tradestalker.com/RBIchat.htm
---------------------------
Good Trading,
Mike Reed
Copyright (c) 2011 by TradeStalker.com, Ft Wayne, IN.
TradeStalker Updates may not be redistributed without
permission.
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.
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