S&P Futures Update for Oct 8, 2012

As we begin the 4th Qtr of 2012 - it is important to keep in mind that we are still 1-timeframing up on a longer-term - monthly basis. No change will occur until this ceases. Lets look at the weekly chart below - 



The weekly bar shows balance. Since coming into Balance in June 2012 and making the swing lows at 1248.50, the market has proceeded in text book fashion - the trend changed to upside - the market balanced - and then resumed the trend. Shown above are 4 distinct balance areas. After making an excess high at 1468 - the market has again come into balance. The question now is will the excess hold and the trend reverse or will the market resume the current trend.



Early Friday - we saw the S&Ps gap up but unable to take out the excess high at 1468. Looking at the profile I see several things of note:
- a poor high - an indication that the market was too long. What followed was a slow liquidation at first which gathered speed once we closed the Gap, however we did not get an Outside Day. Poor highs do get repaired. No sign of new money selling  - Positive
- double distribution day with a Settle at the prominent POC from Thursday - Negative
- Higher Value - Positive

- Poor Lows from 9/28 and 10/2 - reduce the odds of upside continuation - Negative

Trading question for Monday is - do we open in or out of balance relative to the lower distribution from Friday. If we open in the Lower Distribution and trade lower - first destination is Thursday's low -1448.75 and below that 1444. Resistance is at 1457. Opening in the Upper distribution and trading higher targets the recent excess high at 1468.

S&P Futures Update for Oct 5, 2012

The market gapped up today and in the first hour took out last week's high by 3ticks. Looking at the weekly bar below...we are now in a 4-week balance. While I continue to maintain that risk of being long is high based on structure - the market can continue higher. However, when balance areas form this close together - it is a sign of an aging trend and a low confidence market.







Daily Bar below shows two balance areas. After making several attempts this week, price traded into the upper balance and closed within it. The destination now becomes the 1462 area, however, it does not mean it has to get there.








Thursaday's POC was very prominent. Any open away from the POC has high odds of returning to it. Initial support is the "H" period low at 1450.50..below that is the balance area low at 1444.50