2013-04-18

$ES_F : 1555 - 1540 : Expected Day Session Range for EMINI


Cautiously Bearish. 

Near important top. Volatility Expected


The choppiness near the top is creating a set up of possible pause in the rally. Yesterday was a good follow though day for bears coupled with high volume selling. However support was noted at 50 dma and so far that has provided a good 15 points rally from the low. The markets has so far not rejected the 1538 low. However the line in sand for bears is 1558 and hard stop at 1570. If markets starts rising beyond 1558, bears have once again lost strength. The trend is still on the mixed now with bearish bias and there are several signs indicating a fatigue and I am not planning to take a big position either way. I will update the comments as the day develops.



Today again I would expect to find resistance in 1555 area developing a move down to 1540s area. This will be second test of support and if it is breaking market is setting up for a move further down (1530s is first target). Only a decisive break from outside 1572 or below 1540 would indicated that market is taking a view on future direction.

My hypothetical stock portfolio is short as of now.

Have a look at this post from longer term perspective which is keeping me cautious at these levels. Most commodities markets have broken down and signalling an end to commodities bullish cycle.