For Tuesday I want to be looking for a down day and selling into weak bounces or flags. The pivot point on the ES futures is at 857.75. That level should determine the bias of the early morning imo and below that I could see us breaking Monday's lows and filling the gap from Friday. Below that and we could see the 830s quickly so be flexible. Again, I would not be too bullish on this market until it shows us it can breakout of AND close over 875. Trade safe.
Monday, April 27, 2009
While everyone and their brother was busy overblowing this swine flu junk, the market was busy forming an inside day pattern on the SPX. The range of Monday's candle was inside the the range of Friday's candle and this usually precedes a big move the next day and quite often a reversal of the previous few days. So going with that we should assume that the market begins to pullback further on Tuesday. A lot of pros are selling into the 865-875 area the last few weeks and that is a good reason to be doing it yourself.