Here is a 30 minute bar chart of the e-mini day sessions over the past two weeks. This morning the first revision of the fourth quarter GDP estimate was released and turned out to be worse than expected. The e-minis dropped to 729.50 in electronic trading immediately (not shown on this chart) and have rallied since then.News releases like this give us a test of the market's technical condition. How much selling would come in on bad news, at new bear market lows? So far, the answer is "not much". Volume has been moderate so far today and the market dropped for about two minutes after the news, but has rallied since then. I think this action is telling us that the sellers are running out of ammunition and that the buyers are about to get their turn to run prices upward.
Even so, I think it likely that yesterday's 750 low (purple dotted line) will be a temporary ceiling on the market this morning which explains my 748 rally estimate in this morning's guesstimate. I think it likely that the e-minis will drop as low as 725 later today, but I also think that level will mark the low of the two month drop from 942 (25% !). If I am right about this March should prove to be a very bullish month.
4 comments:
Dear Carl,
as a detaled look on the chart,all we can see is a major drop(830);
now its time for a bullish periode.
now i think Snp will reach 795-800 in the 9th or 10th of March...
Regards
R.J.
It is quite possible that March sets up as a very bullish month - In fact, I do think we will put in a decent intermediate bottom in March - the only question is WHEN? If we close near the lows today - wherever those lows may be, then I think we will be set for a very difficult first ten days of March. We have closed near the lows during only one month (June '08) and I think ES needs to be at least 10 preferably 20 points from its low for the market to be reasonably safe for the first ten days of the month
Thank you for sharing your work, Carl. It seems to me that your recent calls have been accurate.
OX.
I would say i agree that March should be bullish...Even in the 30's, you had bullish months...(+25% in march 1930)
the only problem is that Europe's problems seems to be ignored in the USA...
The shoe that is going to drop there will be a new Tsunami that the USA don't seem to care about.
For the banks of the EU, "subprime" is called "Eastern Europe"...Banks from Austria, Germany, Belgium, Switzerland have lend and invest massively in the east."
Here are some facts (sorry it's in french...PIB is GDP!)
- Danemark: GDP: $312 milliards; Danske Bank actifs: $615 milliards (197% du PIB)
- United Kingdom GDP: $2800 milliards; RBS Actifs: $3800 milliards ou 136% du PIB (avec HSBC et Barclays cela monte à 8600 milliards ou 226% du PIB)
- Switzerland PIB: $313 milliards; UBS et Credit Suisse Actifs: $3000 milliards (958% du PIB)
- France PIB: $2600 milliards; BNP Paribas, Agricole, SocGen et Dexia Actifs ($6700 milliards ou 259% du PIB)
As i told before, the EU doesn't have a FED, there are restrictions of lendings to members. We don't even have a European Bond market...so every coutry is on its own!
Now, the EU is trying to rely on the IMF to help the east not defaulting their debts...problem the IMF is broke...
So the EU just gave (today) 24 billions euros to the east...problem they need 240 billions...
Now, IF, and only IF, eastern europe were to default, it would washed out most of european banks and europeans government won't be able to deal with thein promises to guarantee the banks...worth a trillion euros...which they don't have...Each counrty will have to issue bonds...
The question ? as this crisis is global, who's gonna pay for the 3 trillions the us treasury needs AND for the trillions of euros the EU WILL need ?
If you had a single idea on how the european society is organized in Europe, you'll be scared.
By the way, the EU accounts for half of the word trade...(yes more than the USA !)
That's not trading, but some perspectives...
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