Thursday, July 5, 2012

S&P Futures Update for July 6, 2012



As mentioned in previous Blog Post(s) - the S&P's are in a weekly balance bracket between 1255 and the 1400 area - see chart above. Having tested the balance low at 1255, the destination becomes the opposite end of the balance area which 1400+ level. Market has 1-timeframed higher the last four sessions on light volume. So far the market has ignored any bad news in the hopes that the Fed will step in and provide further quantitative easing. As of this morning - the ECB and China have cut key benchmark interest rates and the Bank of England is provided more stimulus.

Trade location is between two Gaps - there is a Gap above between 1373.75 and 1378 and the large 18.5 handle Gap below. Overnite trade on July 4 traded into the Gap making a high at 1375. Lets look at the Profiles next :-


View Tuesday & Thursday as a 2-day Balance. Value was overlapping to lower for Thursday however the price/trade was contained within Tuesday's range. Tuesday's high was poor and Thursday's profile does not look complete to the upside. All eyes are on the U.S. Jobs report due out tomorrow morning at 8:30 am EST which will determine the tone/direction of the market. The trading question is do we Open in or out of balance relative to the 2-day balance area. If we Open out of balance - go in the direction of the breakout.



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