My plan for trading the Rita rally
Pre-market futures are post-Rita green
in relief. It was a bad storm and we extend our sympathies to all who were
affected, but financial markets braced themselves for much worse. That storm’s
mercy coupled with end-month and end-quarter upside bias this week have pre-market futures set to gap-up open and possibly sail away from there.
ES (+$50 per index point)
S&P 500 has next resistance near 1230 level.
Overnight highs at 1229 (not shown) have probed this mark once. A break & close
above clears the way to 1243 from there.
MD (+$100 per index point)
S&P 400 looks at 711 as bullish confirmation
above and next line in sand for bears. Short at the mark and long above on
successful break are the high-odds trades here today.
YM (+$5 per index point)
Dow Industrial futures have 10550 to contend
with above, probable to be tested early today.
ER (+$100 per index point)
Russell 2000 futures have 633.70ish as pivotal
mark on this chart. Pre-market futures are trading right there at this time. I’ll
probably target 1/2 position long above this value, add to it if upside pops and
look to ride any early euphoria to the first zone of sideways congestion from
there.
{Price levels posted in charts above are
compiled from a number of different measurements. Over the course of time we
will see these varying levels magnetize = repel price action consistently}
Summation
Traders are expecting similar post-market reaction to London bombing
and Hurricane Katrina: bounce from lows to new recent highs in flag-pole
fashion. Mutual funds will try to fulfill this prophecy in order to mail out
gussied-up performance reports for the month and quarter periods. As always we
will trade long & short according to signals given, but upside bias exists for
today and late this week due to fundamental underpinnings as well.
Trade To Win
Austin P
(free pivot point calculator, much more inside)
Austin Passamonte is a full-time
professional trader who specializes in E-mini stock index futures, equity
options and commodity markets.
Mr. Passamonte’s trading approach uses proprietary chart patterns found on an
intraday basis. Austin trades privately in the Finger Lakes region of New York.