Which One Of These Descriptions Fits You?

February 25, 2004
Chris Curran

Stock
index futures opened Tuesday’s session with a small downside gap after a tight
overnight range. Off the open, the 1136-35 level was the area to watch with a
combination of Monday’s session low, Daily S1, and Weekly S1. The
lower-than-expected release, and lowest number since October, of February
Consumer Confidence at 10 ET led to fast market conditions and after 2 tests of
that support, the shorts ran for cover to officially close the opening gap and
push the ES through its Daily Pivot. After a choppy, lunchtime range, the ES
took another dip to the session low and after flushing out the sell stops,
ground its way back up to finish mid-range.

The March SP 500 futures closed
Tuesday’s session with a loss of -1.50 points, and just finished in the lower
1/2 of its daily range. Volume in the ES was estimated at 742,000 contracts,
which was ahead of Monday’s pace, and above the daily average. Looking at the
daily chart, the ES reversed off its 62% retracement of the 2/5-2/11 up move,
but still couldn’t finish back above its 20-day MA. On an intraday basis, the
60-min, 30-min, and 13-min charts all closed with inverted cups and handles
testing resistance.

The Semiconductor Index (SOX)
retraced back up into its 100-day MA and a head and shoulders neckline, and
still faces a lot of resistance above those levels. The Banking Index (BKX)
posted a doji and held day 3 of testing its 20-day MA and daily uptrend line
suppo

Wednesday is light in terms of
economic news, with January Existing Home Sales the only one scheduled at 10 am
ET. The intraday swings
we’ve seen lately reflect the battle going on right now between 2 groups of
players. The first is hesitant to buy at these “lofty” levels, but doesn’t want
to miss out on another run. The other group has been in the market and the
ever-growing possibility of a correction is inducing them take profits. Until a
new catalyst emerges to stifle some of the emotion, the swings should continue.