5 factors poised to drive the market
Stock index
futures opened Tuesday’s session lower, after giving up overnight gains, after
the September PPI, which was already expected to come in higher, posted the
largest month-over-month increase in 15 years. The equities markets
quickly churned into “wait and see” mode until news of a suspected terrorist
threat in Baltimore brought in some slow selling that picked up speed as sell
stops were hit. We simply didn’t have any real catalysts that were needed
to get some follow-through buyers to step up with any conviction.
The December SP 500 futures closed out Tuesday’s session with a
loss of -12.75 points, while the YM held on much better on the heels of earnings
from IBM and MMM with a loss of -63 points. Looking at the daily charts, the ES
posted a market structure high off of its 10-day MA and erased the gains for the
past 2 sessions. The YM also posted a market structure high after testing its
20-day MA and settled right on its 10-day MA support. For you daily 3-Line
Break followers, the ES barely remains long with a Break Price of 1178, while
the YM is also long with a Break Price of 10216.
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After hours, the futures were pretty flat following
news that tech bellwether INTC had beaten revenue estimates, but missed on the
bottom line. Wednesday has usually been the best “action” day of options
expiration week, and we do have a few economic reports with Housing Starts and
Building Permits at 8:30 ET, and the Fed’s Beige Book at 2:00. Those will
most likely take a back seat to earnings news and the weekly energy numbers at
9:30.
Plan Your Trade and Trade Your Plan
Before you
even consider trading, it is important to take the time to seriously question
your intentions in the market. Do you see futures trading as the means to a
quick profit? Are you trading for excitement or a rush? Are you
interested in trading because you seek satisfaction on a purely intellectual
level? Do you see trading as a hobby or as an additional diversification
of investment? Are you looking for a way to fund your early retirement, or
do you see trading as an opportunity to augment your savings? Do you
desperately need the profits that trading might bring to cover debts, like your
mortgage, or other financial commitments?
You’d think
it would be an easy question, but I’ve come across many traders who simply don’t
know why they want to be in the market. By taking the time to honestly evaluate
your reasons for trading, not only will you learn more about yourself but you’ll
also be forced to justify your commitment of hard-earned capital to the market
gods. Remember, if your rationale is unclear, so too will be your trading.
Daily Pivot Points for 10-19-05
| Symbol | Pivot | R1 | R2 | R3 | S1 | S2 | S3 |
| INDU | 10310.66 | 10336.07 | 10386.87 | 10412.28 | 10259.86 | 10234.45 | 10183.65 |
| SPX | 1182.08 | 1186.04 | 1193.93 | 1197.89 | 1174.19 | 1170.23 | 1162.34 |
| ES Z5 | 1186.33 | 1191.92 | 1202.33 | 1207.92 | 1175.92 | 1170.33 | 1159.92 |
| SP Z5 | 1185.00 | 1189.00 | 1196.60 | 1200.60 | 1177.40 | 1173.40 | 1165.80 |
| YM Z5 | 10334.67 | 10371.33 | 10435.67 | 10472.33 | 10270.33 | 10233.67 | 10169.33 |
| BKX | 94.83 | 95.12 | 95.67 | 95.96 | 94.28 | 93.99 | 93.44 |
| SOX | 440.16 | 442.98 | 446.65 | 449.47 | 436.49 | 433.67 | 430.00 |
Weekly Pivots for the Week of 10-17-05
| Symbol | Pivot | R1 | R2 | R3 | S1 | S2 | S3 |
| INDU | 10255.64 | 10354.82 | 10422.30 | 10521.48 | 10188.16 | 10088.98 | 10021.50 |
| SPX | 1183.76 | 1199.33 | 1212.08 | 1227.65 | 1171.01 | 1155.44 | 1142.69 |
| ES Z5 | 1188.75 | 1205.75 | 1221.50 | 1238.50 | 1173.00 | 1156.00 | 1140.25 |
| SP Z5 | 1187.73 | 1203.47 | 1217.03 | 1232.77 | 1174.17 | 1158.43 | 1144.87 |
| YM Z5 | 10280.67 | 10383.33 | 10464.67 | 10567.33 | 10199.33 | 10096.67 | 10015.33 |
| BKX | 94.45 | 96.04 | 96.85 | 98.44 | 93.64 | 92.05 | 91.24 |
| SOX | 444.27 | 455.44 | 468.18 | 479.35 | 431.53 | 420.36 | 407.62 |
Please feel free to email me with any questions
you might have, and have a great trading week!
Chris Curran
Chris Curran started his trading career at the
age of 22 with a national brokerage firm. He combines fundamentals and
technicals to get the big picture on the market. Chris has been trading for 15
years, starting full time in 1997, and has never had a losing year as a
full-time trader.