Up, Up And Away?
Short covering and one large dealer were in the spotlight this morning, fueling a fast 1850 point rally in the SPZ.
Locals and some smaller dealers were sellers on the open, but as the NDZ was failing, consistent bids were being seen on the way down from a number of key players. Once the NDZ stabilized, it was a race between the shorts covering and the fresh buyers entering the market.
Strong buying was seen around the 1522 and 1525 levels, with buy stops being found above 1529, which was Thursday’s settlement.
Now that everyone is confused, the question is where do we go from here? My feeling is that we have seen the session highs and are poised for a retracement through the 1518 level. If the selling accelerates, look for a settle below the 1512.50 session low. If this does not happen and we continue to probe the upside, I think 1533-1535 will hold any significant rally attempts.
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