These 2 Sectors Offer the Best Rewards
Friday’s emini session was one of
rolling price action from 8:30am EST to the close. Up & down thru rolling swings
that finished lower than Thursday’s close. Neither buyers or sellers could
prevail… but one side or the other will probably wrest control by the finish
of this week ahead.
R2 = solid red line
R1 = dashed red line
Pivot = navy blue line
S1 = dashed green line
S2 = solid green line
ES (+$50 per index point)
S&P 500 futures gapped down from the open,
dropped thru S1 values and wedged below there for a bit, stepped upwards toward
Globex highs and then chopped back down to close near the lows. Clearly an
unstructured session, no directional bias at all. Several decent swings for
small profit trades, 10.5pt total intraday range.
ER
(+$100 per index point)
Russell 2000 futures were relatively stronger
than other eminis as usual. Opening gap was filled, quick trip down to S1 soon
swung upwards above the daily pivot point. That didn’t last, and a break below
tapped previous support then turned resistance before dropping -5pts into the
closing bell.
Again, mostly a sideways session that spanned
10pts high to low but only offered several small-profit plays.
ES (+$50 per index point)
The most recent low – high swing closed below
62% retrace on Thursday, then tested & failed that former support as the session
highs on Friday. Year 2006 price action is rolling thru a sideways range that
appears to be wedging up for directional blastoff, up or down. 1262 previous
lows are next visible support with 1250 just below there.
ER
(+$100 per index point)
Small caps remain the pillar of strength. Now
sitting right on 38% retracement of the previous low-high swing, this index is
100% bullish. Thursday’s long red candle followed by Friday’s Doji of indecision
does visually state that price action must hold sideways to higher if further
upside is in the cards. A break below 715 in a daily close would be quite
bearish indeed.
Summation
Small caps and mid caps continue to be the market leaders, or should we say
market props beneath charts that look extended and in need of rest. The FOMC
event has passed, earnings season will wind to a close with traders left to buy
or sell stocks on their own merit. Or might the tapes remain hostage to
guesswork on what the Fed will do next? My guess is that some as-of-yet unknown
catalyst will drive the markets somewhat higher or shock them considerably
lower. For now we work within sideways, choppy conditions and await the next
directional trend from there.
Trade To Win
Austin P
(Online video clip
tutorials…
open access)
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.