E-mini futures outlook
Happy Halloween!
As the current month and fiscal-year
end for some funds draws to a close, market action continues according to
script. Regardless of all else that goes on, stock index prices keep marching
upward. Oil drops -$2 barrel? Stocks rally. Oil rises +$2 barrel? Stocks rally.
Earnings reports are good or bad? Stocks rally. See a pattern?
Chart 1: ES (+$50 per index point)
S&P 500 repeated the same persistent pattern
we’ve seen for weeks now: early dip to S1 values or even the daily pivot marks
low of the session as buy programs kick in. Very simple trading right now: short
side offers nil profit potential while buying every dip offers the bulk of
intraday gains.
Chart 2: ER
(+$100 per index point)
Ditto for Russell 2000 futures. Buy the dips
when offered, which has worked thru the month of October to now.
Chart 3: ES (+$50 per index point)
S&P 500 futures pulled into upper support
yesterday on a widely-watched Fib grid. Countless 1,000s of traders across all
instruments have buy stops resting near that level, and it was hit. On the last
day of the month = fiscal year for some big money players, a drop below Monday
lows is doubtful.
In the near future, 1367 is the first real
measure of lower support followed by 50dma currently at 1348+ in the Dec
contract.
Chart 4: ER
(+$100 per index point)
Russell 2000 futures remain sideways in a
rolling range the past twelve sessions. Visible support near 755 and then 50dma
(currently at 745) mark bullish zones above. Until either / both of those levels
break, upside bias remains firmly intact.
Summation
It’ll be interesting to see how price action behaves past next Tuesday when
elections clear. Many if not most retail traders are positioning themselves for
the obligatory Xmas rally. We’ll see. Meanwhile, the next week or so should
remain firmly propped upside. I’m trading (intraday only) short side
conservatively and long side aggressively until that pattern ceases to persist.
Meanwhile, buying the dips like it’s 1999 seems to be de javu all over again.
Trade To Win
Austin P
(Online
video clip tutorials…
open access)