Wednesday, April 29, 2009

Living On A Prayer?

The market ripped out of the gate on Wednesday as GDP was decent and challenged the 870 resistance level on the ES before the FOMC announcement. After the FOMC the market spiked higher and looked like it was headed higher into the close as bonds and gold sold off. However, the ES topped at about 879 and reversed lower to close still positive but off the highs. You got to be impressed with the way the market just grinds higher lately. The pullbacks are shallow and when the buyers come in the rallies are sharp. I have been saying expect a pullback into the low 800s possible soon and I still think its possible. But above this 875 area and you have no choice but to be bullish, sorry bears.

For Thursday I want to be watching the 875 area and especially Wed. highs to see if they can be broken out of. The pivot is at 868.75 so I will very bullish above that and possibly expecting the 890s to come into play by Friday if we have a positive Thursday that holds strong over the pivot. We are trading the low 870s tonight and things look good but if we somehow lose the pivot in the morning then I would look for lower price action into the weekend with even a possible break of 850. For now you gotta have a bullish bias. Trade safe

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