TradeStalker's
Support and Resistance Update
6 / 30 / 2011
(Published Since 1996)
...............................................
Dateline: 8:23 pm eastern time, 6/30/2011
The ES opened higher on Thursday and a pullback from 1307.50
held the updated 1305.50 support and shot higher to 1316.75
by noon. The move ran out of gas, and a pullback too the ES
to 1312.25 with an hour left in stock trading. Buyers/ short
covering ran the ES to a token higher high at 1317.50 and
then backed off and pulled back into the close.
The market closed higher every day this week so far. The
SP500 cash is up 52.19 points on a closing basis. There has
been 4 days in a row with over 2000 advancing issues on the
NYSE, normally a set-up for a pullback. For the second day
in a row both the RBI oscillator is in overbought territory
along with the three-day thrust oscillator being at in
extreme overbought reading. Under most cases the market will
at best have trouble making more progress on the upside.
More often not, the market will sell off to relieve the
overbought condition. It's not just these two indicators
that are overbought. The short-term volume oscillators are
also at extremes, with the four-day volume oscillator over
.80. Also, with the four day string of 2000 (or more)
advancing issues on the NYSE, short-term breath oscillators
are also overbought. The McClellan oscillator is above plus
200 for the first time in a few months. The Vix dropped
under 17 on Thursday and now is giving two of a possible
five VIX sell signals.
The market can get overbought and stay overbought when all
the conditions are favorable. The market had been in a
trading range, but is trying to break out on the upside. A
failure to do so early on Friday should cause some profit-
taking in front of the holiday, at the least. As long as a
pullback can hold around the 1312 area on the ES, then the
up trend can continue. However, if that area is broken and
the market does not quickly turn right back up, then things
could be changing. A move down to the 1308.50-1308.00 area
on the ES would be next, and appears to be a key support if
it's tested. If the market gets back down there, it must get
turned back up with good buying, otherwise they drop back
down to the 1302 area.
So, on Friday look for early strength to be reversed in the
first 30 minutes of trading. If there is a small pop up
higher on the open, then expect a reversal from that type of
action. If that plays out, look to take off part of the
position around the 1312 area on the ES and tighten up your
stop on the remainder. If there is no sign of turning back
up from that 1312 area, then we should see the 1308 area and
possibly back down towards 1302 if the downside gathers some
steam. On the upside, it will take a break and hold over
1317.50- 1318.00 area to keep the upside going and possibly
go for the 1325 area before this move is over.
Have a great, safe, holiday weekend! The next nightly update
will be sent on Monday.
September 2011 SP futures resistance
symbols: emini = esu1 / big contract =spu1
1317.50-1318.00
1324.25-1325.00
1328.25-1329.00
September 2011 SP futures support
symbols: emini = esu1 / big contract =spu1
1312.50-1312.00
1308.50-1308.00
1302.00-1310.75
September 2011 Nasdaq futures resistance
symbols: emini = nqu1 / big contract = ndu1
2323.50-2324.50
2337.75-2338.50
2342.75-2344.50
September 2011 Nasdaq futures support
symbols: emini = nqu1 / big contract = ndu1
2316.50-2316.00
2307.00-2306.50
2298.00-2296.50
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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.
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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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