What’s Needed For Another Leg Up
Chop and consolidation have been
among the themes of the trade on this light-volume morning, as traders continue
to digest yesterday morning’s moonshot.Â
Hourly trends on both major indices remain up as we approach midday, which have
thus far provided headwind resistance on any consolidation breaks to the
south. The 13 did technically break its uptrend in the morning trade — albeit
with limited follow-through given the hourly — so its trendline is currently
providing interim resistance to the north.
Traders may do well to keep an eye on pullback opportunities on the hourly which
have yet to occur since Thursday’s cover scramble. Since markets can approach
support in one of two ways — through a reduction in price or by support
approaching price during consolidation — momentum indicators may become
increasing important to gauge “coil” potential if the hourly proves that
yesterday’s reaction is longer lasting than the numerous false rallies of 2002.Â
Specifically, a drop in the hourly stochastic
coupled with a hold of support may provide ingredients for another leg up. Yet
volume has frankly been pathetic since the early trade, so market participation
of lack thereof may continue to play a role as we close out the two-week Holiday
trade
ES (S&P)Â Â Â Â Â
Friday January 3, 2003 11:45 A.M. ET       NQ
(Nasdaq)
Moving Avg Legend:
5MA
15MA 60-Min 15MA
See
School and
Video for Setups and Methodologies
Charts ©
2002 Quote LLC
Good Trading and Have a Great
Weekend!
Â