S&P Futures Morning Update for July 13, 2012

The overnite Inventory is 100% Long. More often than not there is some kind of adjustment to the Overnite Inventory at the Open. If the market doesn't care about overnite Inventory and proceeds higher - that is positive. 1328-1330 remains possible support. Acceptance below this level keeps the short term down trend in place. The market tagged the prominent POC 1336.5 from Wed in the overnite session. If we stay above 1328-1330 - also the overnite Low - the prominent POC is the likely destination. Market remains very short.

S&P Futures Update for July 13, 2012

The S&P's have been 1-time framing down for the last 6 sessions - short term trend is clearly down. I had also said in y'day's and this morning's blog that the market was too short. What occurred today was exactly what I had envisoned - closure of the Gap below - market found resting buyers - spent the rest of the day short covering. However, Value was clearly lower and we could not tag the prominent POC above at 1336.50 and the market settled below 1330 - low of the previous balance area - which is negative.

Next week is options expiration week. It is not uncommon for the market to make a low on the Thursday or Friday the week before options expiration and rally into the expiration week.

The market remains very short and while structure/volume underlying this recent decline is quite poor the market can continue lower towards the 1300 level. No change will occur until we stop 1-time framing down or the market comes into balance. Looking at the profiles near the balance area lows (June 25 and June 28) shows a couple of poor lows that need repair.
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