Monday, April 13, 2009

Banks Making Money?

After Wells Fargo reported a multi-billion dollar profit for the first quarter last Thursday, Goldman joined the club of profitable banks today that may pay back their loans sooner than thought. Of course to pay back the loans they are issuing more stock ($5 billion worth) and that will pressure the stock on Tuesday perhaps. Overall, the banks, specifically Goldman, still look fantastic on the charts.

The market had a great day on Monday but is pulling back quite a bit after hours. The ES futures are trading 847 after getting as low as 844 and looks like we may gap down a bit in the morning. I still have an overall long bias but we may see the market pullback a bit into midweek. The pivot on Tuesday is at 852.25 and if price stays under that pivot through the morning then I would have an intraday downside bias and expect price to perhaps hit the mid 830s and try to fill last week's big gap down there maybe. Of course if they push this above that pivot then I think we see 876 by expiration Friday.

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