2013-02-19

$ES_F : 1516-1525 : Expected Day Session Range for EMINI


Cautiously bullish on this volume less trade.

Market is still in the grip of bulls even though volumes are plunging and bearish divergences emerging. 


Hope my friends in US had a happy and relaxed extended weekend. Things have not changed much on this side of the pond. Some well planned crooks managed to steal a huge haul of diamonds from Brussels airport. With all the drama our governments do at airports in the name of security, these incidents show that a determined person would not necessarily take the route via the metal detectors and frisky hands of security personnel. In other news Paris police are weighing up to spend 1 million to determine a criminal or let the matter go in the name of austerity. HLF should be active overnight once again when the company, stuck in the ego of major wall street big shots, announces earnings. This was an important lesson in reacting to news for traders. Once 13D was announced, there was a panic in the overnight market, expecting a short squeeze and massacre, all of which turned out a damp squib. A patient trader would work on targets and bank some money. It would be interesting how far Icahn (I am always tempted to write his name as iCahn for some strange reason) would push this saga.

Coming back to our S&P it seems clear that not much has changed. Overnight the markets looked slightly bullish with no major movement. The market is still within 1510-1522 trading range, and still trading within previous day range. Possible expected break out from this range is on the up-side. On economic announcement front there is not much action today. Today I would expect support in 1516-1514 area. I will update the comments section as the day develops.

Today my initial bet would be to find support in 1516-1514 area leading to a build up to new highs in 1525 region. I would expect the highs of the day in 1524-25 area expecting a narrow 8-10 point range. I am cautious on the bullish side today given the lack of volume and flirtation with resistance zone. Any sign of weakness can spoil the party.

In my hypothetical stock portfolio I am keeping an eye on remaining HLF position.

If market starts breaching 1508 I would need to reject the bullish case temporarily and expect further move down.