Sold Out?
The question rolling through the SPU pit this morning was if the market was sold out. After 120 minutes of trading, the answer seems to be yes.
Locals were aggressive sellers on the open with expectations for a massive selloff with the NDU locked limit down on the open. But a funny thing happened–buyers appeared in the form of dealers, and they have led us back towards unchanged. After speaking with many of the desks, the consensus seems to be this open was a gift from the heavens, allowing shorts to cover before Friday’s payroll report.
Above our resistance level of 1441-1443, the buying activity was fierce, taking us to 1448.50. Since this time, we have been involved in a 2-way trade that has been dominated by locals.
Moving forward, I would look for continued short covering and a move towards 1456. Any settlement above this level would be a suprise. One note of caution–it seems as though those dealers who needed to get orders done have completed them. This could lead to a very choppy, thin trade dominated by 5-lot-and-under local traders. These are not favorable conditions to the average off-the-floor daytrader, so be careful.