We may see a strong move Wednesday — here’s the trigger

Stock index
futures opened Tuesday’s session in dead water after a tight overnight range.

News at 10:00 that Consumer Confidence was even sharply lower at a 2-year low
than the already lower expectations sent the SPoos into fast market conditions
with sell programs leading the way down for new session lows. After a
choppy grind back to the flat line, some confidence came in courtesy of Alan
Greenspan, who triggered a short squeeze with his neutral speech that said
little about the economy or monetary policy. That too found no
follow-through as the futures kept to the “path of least resistance,” (or in
this case support) theme for the day.

The December SP 500
futures closed Tuesday’s session with a small +1.25 point gain, while the YM
showed a little bit better relative strength with a +34 point gain. Looking at
the daily charts, the ES posted a doji and continues to form a bear flag right
at its 50-day, 20-day, and 10-day MAs. The YM posted yet another doji and is
forming a bear flag into good resistance marked by its 100-day, 20-day, and
10-day MAs. On an intraday basis, MA resistance was broken on the
short-covering run and is now acting as support on the 60-min, 30-min, and
13-min charts. For you daily 3-Line Break followers, the ES is short with a
Break Price of 1248.50, while the YM is also short with a Break Price of 10720.

Wednesday morning at 8:30 ET
gives us the August Durable Orders report, which is expected to post a modest 1%
bounce after the previous month’s slide. The weekly oil and gas numbers
from the API and the Energy Dept. at 10:30 ET will surely draw some attention as
gasoline supplies go for a 3rd straight week of build-up. All fundamentals
aside, the VIX has pulled back and tested support a few times now, and combined
with the major indexes working off last week’s slide with time (judging by the
action the past 2 days), could be setting the equities markets up for a new leg

Yesterday, Today, and Tomorrow

There are 2 days in every week about which we
shouldn’t worry. These 2 days should be kept from fear and
apprehension. One of these days is yesterday, with its mistakes and
cures, its faults and blunders, its aches and pains. Yesterday has passed
forever beyond our control. All the money in the world cannot bring back
yesterday. We cannot undo a single act we performed. We cannot erase a single
word we said. Yesterday is gone beyond recall.

The other day we should not worry about is
with its possible adversities, its burdens, its large promise, and
perhaps its poor performance. Tomorrow is also beyond our immediate control.
Tomorrow’s sun will rise, either with a great sunrise or behind a mask of clouds, but it
will rise. Until it does, we have no stake in tomorrow, because it hasn’t even
happened yet.

This leaves only one day – TODAY.
Anyone can fight the battles of just 1 day. It is only when we add the burden
of those other 2 periods beyond our control, yesterday and tomorrow, that we break down. It is
not the experience of today that drives us mad. It is the remorse or bitterness
for something that happened yesterday or the dread of what tomorrow may bring.
So, we have to do our best to live but 1 trade at a time.

Daily Pivot Points for 9-26-05

Symbol Pivot R1 R2 R3 S1 S2 S3
INDU 10456.03 10496.43 10536.66 10577.06 10415.80 10375.40 10335.17
SPX 1215.65 1220.18 1224.71 1229.24 1211.12 1206.59 1202.06
ES Z5 1221.25 1226.50 1231.25 1236.50 1216.50 1211.25 1206.50
SP Z5 1221.23 1226.27 1231.03 1236.07 1216.47 1211.43 1206.67
YM Z5 10490.33 10533.67 10573.33 10616.67 10450.67 10407.33 10367.67
BKX 96.26 96.63 97.03 97.40 95.86 95.49 95.09
SOX 458.54 462.34 467.54 471.34 453.34 449.54 444.34

Weekly Pivot Points for Week of 9-26-05

Symbol Pivot R1 R2 R3 S1 S2 S3
INDU 10471.71 10592.45 10765.32 10886.06 10298.84 10178.10 10005.23
SPX 1219.43 1233.50 1251.72 1265.79 1201.21 1187.14 1168.92
ES Z5 1224.83 1238.92 1257.08 1271.17 1206.67 1192.58 1174.42
SP Z5 1224.70 1238.40 1256.50 1270.20 1206.60 1192.90 1174.80
YM Z5 10501.67 10619.33 10787.67 10905.33 10333.33 10215.67 10047.33
BKX 97.11 98.91 101.10 102.90 94.92 93.12 90.93
SOX 462.74 472.67 484.62 494.55 450.79 440.86 428.91

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.