Monday, June 21, 2010

21/06: Markets open strong on renminbi appreciation rhetoric

Markets greeted the day's session with a pop of between ~1 and ~1.5 percent (/ES up sixteen was a figure I heard at least twice on CBS Marketwatch in the early AM; it's still reverberating in my ear, somewhere).

Yet I've just now, moments prior to slipping away for lunch, discovered the tastiest chart of the day. Here she is:

That's right, GS, the bellwether of bellwethers, is lining up for possibly significant up or down movement (with probability to the downside), coming up as it is to a trio of significant resistance forces:
1) A robust price channel dating from March 5, 2010
2) 200-period simple moving average, using hourly bars (non- extended hours) as periods
3) The psychological resistance of $140.0

Do I hear some bears roaring?

Wednesday, June 16, 2010

Ah, television...

Just heard on CNBC by a supposed Eastern Europe investment "expert" (6/16, 2:24p EST) -- "...countries like Czechoslovakia...".

*roll eyes*

Banner day on the markets, meanwhile; decisive break through the S&P500 200SMA!

Thursday, June 10, 2010

10/06: Markets rally strong on /ES crossover day

Briefly, markets are recording a powerful rally today, albeit one that has stalled in the late morning (as these words are being written). Complicating technical analysis is the irksome matter of crossover from the /ES June contract to the September expiry; not a futures trader, my understanding of the logic is fuzzy, as the June contract still has 8 days to expiry; however, I assume it has to do with the accelerated decay of time premium over this home-stretch period.

The crossover has interfered (significantly) with technical analysis, since per my rough calculations and observation:

'/ES June' = '/ES September' + 4.5

From another perspective, and incorporating the above equation perfectly, whereas the prior relationship between /ES (June) and SPY had been: '/ES'*(1/10) + .5 = SPY, the new relationship -- i.e. of /ES (September) and SPY -- seems to be:

'/ES September'*(1/10) + .95 = SPY

Thus, while I would be pleased to post some interesting charts of /ES futures, I fear that my price channels and other support/resistance levels have been temporarily rendered suspect. I'll provide, instead, a chart of a highly tantalizing short set-up in HSY (Hershey); I only wish I'd discovered this robust price channel as HSY was powering through $42 earlier today.

Thursday, June 3, 2010

03/06: Market volatility extends into June; near-term upside

Markets today appear poised to venture firmly into higher territory, with /ES futures holding stubbornly above 1100 in overnight trade. Technically, the inverse head-and-shoulders pattern of late May in the /ES appears sound; it marks a near-term market capitulation. I expect a high probability of further appreciation to approximately 1120, at which point e-mini futures will encounter significant resistance of the upper price channel comprising nearly two (tumultuous and highly significant) months of price action. A dip to about 1090 -- the less robust mid-point of the price channel -- is possible prior to the ascent to 1120, and a re-test of 1100 is highly probable. And, finally, I expect markets to abstain from a rally at 1120 until after tomorrow's AM release of the May unemployment number.

Here's a wide-lens view of the pivotal e-mini contract:

Tuesday, June 1, 2010

01/06: Markets under pressure, geopolitical concerns mount

On this first trading day of June, /ES futures point to a sharply lower open (they're presently down about 11 points, a considerable drop, though considerably improved on their nadir of down approximately 19 points to 1069).

For proper perspective, however, consider this ~50 day chart of the /ES, using 2-hour bars (and full 24 hour price action) --

Per the above chart and its price channel, the overnight drop to 1069 is within expected price action (i.e. within the price channel). Furthermore, the late-May break below the lower price channel and subsequent recovery signals a bullish capitulation, and this morning's retracement to the lower price channel is consistent with an upward, post-capitulation trajectory.

In short, I'm bullish as long as /ES holds above 1069, i.e. the lower price channel. A break below, and particularly movement to below 1060, would shift my sentiment to decided bearishness and lead me to project further selling to at least 1020.