TradeStalker's
Support and Resistance Update
8 / 7 / 2011
(Published Since 1996)
...............................................
Dateline: 5:36 pm eastern time, 8/7/2011
It was another bad week for the bulls last week, as the
market dropped to new lows for the year. On Thursday the
market was hit the hardest, as the Dow lost over 500 points
and the S&P 500 lost 60 points. On Friday the employment
data was a bit better than expected, and the ES opened up
about 13 points, but that move was sold and after five
minutes of trading the market rolled over again. A small
bounce started around 10 AM, but that didn't stick and the
ES dropped to 1163.25 by noon. The market reversed off of
that level with some gusto and the ES rallied up to reach
1210.00 before the market flattened out. A drop back down to
1184.75 occurred until the last 30 minutes of trading, and
then the market moved higher in very choppy action into the
close.
As I stated on Thursday, expect the volatility to pick up
and we certainly had that on Friday. The ES dropped 52.25
points from its 1215.50 early high to its 1165.25 low on
Friday. From there it rallied back 46.75 points to 1210.00
before stalling out. From there, a drop of 25.25 points down
to 1184.75 occurred until about 30 minutes left in trading.
From there a relatively small bounce of 14.50 points
occurred before the market closed. That is about 140 points
of travel just counting those swings. In fact, on Friday we
had moves of almost 5 points occur on a few one minute bars,
which really shows a jittery market looking for direction.
The market is deeply oversold, and we could have another big
rally at any time. However the market has gotten to a point
where it's about turning into "the better the bounce, the
better the shorting opportunity when it fizzles" the way it
is acting. And these aren't exactly normal conditions for
the market to undergo. That is the main reason for kind of
ignoring the deeply oversold short-term indicators, and
instead going with the price action and key resistance to
break instead.
Things can change over the weekend, but it looks like the
market will avoid trouble on Monday if it can hold above the
initial support areas. If those are broken, then a drop back
down towards the 1185.50-1184.50 area could be in the cards,
and should be key support on Monday. If that area is held on
a pullback, and the market turns up, then we could have
another good rally occur from there. If that area is broken
and not quickly reversed, then the market is back under
pressure and a move towards a Friday lows could be in the
cards. On the top side, if there is a bounce that rallies up
to test the initial resistance areas (or lower) and it
stalls out, then be ready for a decent sized pullback to
occur. However, if we do get that run up to test the 1212
area on the ES, and then a pullback can hold at or above the
1208 area, then another push higher should be in the cards.
If the ES gets up to that 1212 area, but a pullback shows no
sign of holding, or quickly reversing from that area, then
the downdraft should be back in gear for a move back to test
the 1200 area or maybe the lower.
September 2011 SP futures resistance
symbols: emini = esu1 / big contract =spu1
1212.00-1212.50
1219.00-1219.50
1223.25-1224.00
1228.00-1229.00 *strong
September 2011 SP futures support
symbols: emini = esu1 / big contract =spu1
1193.50-1193.00
1185.50-1185.00
1179.50-1178.50
1174.00-1173.50
1168.50-1168.00
1163.25-1162.50
September 2011 Nasdaq futures resistance
symbols: emini = nqu1 / big contract = ndu1
2223.50-2224.50
2238.50-2239.50
2246.50-2247.50
2262.50-2264.25 *strong
September 2011 Nasdaq futures support
symbols: emini = nqu1 / big contract = ndu1
2184.00-2182.50
2171.00-2170.00
2158.50-2157.50
2148.00-2146.75
2134.75-2134.00
2128.75-2127.50
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---------------------------
Good Trading,
Mike Reed
Copyright (c) 2011 by TradeStalker.com, Ft Wayne, IN.
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The foregoing has been prepared solely for informational
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research and data believed reliable, but there is no
guarantee that future results will be profitable.
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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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