TradeStalker's
Support and Resistance Update
8 / 2 / 2011
(Published Since 1996)
...............................................
Dateline: 7:56 pm eastern time, 8/2/2011
The ES opened lower, and turned up from the 1273.00 support
and bounced to the 1280.00 level before turning back down. A
pullback to 1273.00 then gave a bounce up to 1276.50, but
that failed and the ES dropped down to 1267.25 and made a
small bubble bottom. The ES barely got over 1270.50 (two
1271.00) but then quickly reversed and the market got hit
with more selling. The ES reached the 1258 major support
before a bounce occurred. The bounce reached at 1364.50
level and stalled out, and a drop down to test 1258
followed. Another bounce back up to 1364.50 also failed, and
the market headed lower from there. We were looking for a
lower low to be made by 3:30 PM, and that occurred as the
market continued to go trend down right into the close. The
ES reached 1246.75 in the final minutes of trading, closing
at its lowest level since April.
Off of the July rally highs the Dow cash lost 858 points,
the SP500 Cash lost 91 points, and the ES lost 95.25 points
on a closing basis. That's quite a drop over just a week and
a half. There's little doubt that the market is oversold
pricewise short-term. In addition to that, the closing Trin
was a 4.50 on Tuesday, a sign of capitulation. It also was
the 5th day in a row that the Trin closed above 1.10. Other
short term internal gauges are at deep oversold territory.
These normally set up a decent bounce. The fly in the
ointment is that the market has had a lot of technical
damage done over the last eight days, and the market has
good downside momentum. The market needs something positive
to come out to spark some buying that can stick. I'm not
sure what will bring that about on Wednesday.
The way the market acted on Tuesday, it will be a surprise
if there is not follow-through selling. If there is follow-
through selling, then the 1244.00-1243.50 area needs to
hold, or be quickly reversed if broken, if there is going to
be a snap back rally in the early going. If that doesn't
occur from that zone, then we could drop down to that
1238.50-1237.50 area if there is some more "get me out" type
of selling. On the other side of the coin, if there isn't
follow-through selling early, but instead the market pops up
on the open, then that should set up another shorting
opportunity, especially if the ES moves up to tag the
initial resistance area and then reverses back down.
After the early action, stay updated via instant message.
Many are not using this service, which comes at no extra
cost with your subscription. We have been able to pinpoint a
good number of bounce highs and short-term bottoms that
can't be acted upon unless it's by instant message. All you
need to do is log-in at this link:
http://www.tradestalker.com/RBIchat.htm
Aside from that, I will try to send three intra-day updates
to the member site during the day.
September 2011 SP futures resistance
symbols: emini = esu1 / big contract =spu1
1258.00-1258.50
1264.00-1364.50 *key
1271.50-1273.00 *major Wednesday
September 2011 SP futures support
symbols: emini = esu1 / big contract =spu1
1246.75
1244.00-1243.50 *key early
1238.50-1237.50 *strong
1233.00-1232.00
1228.00-1227.50 *major
September 2011 Nasdaq futures resistance
symbols: emini = nqu1 / big contract = ndu1
2302.75-2303.25
2316.25-2317.00 *key
2327.25-2328.50 *major Wednesday
September 2011 Nasdaq futures support
symbols: emini = nqu1 / big contract = ndu1
2285.75
2282.75-2282.00 *key early
2270.00-2269.00 *strong
2262.50-2260.50
2250.75-2248.50 *major
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Good Trading,
Mike Reed
Copyright (c) 2011 by TradeStalker.com, Ft Wayne, IN.
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