Thursday, July 30, 2009


Here is a 30 minute bar chart of e-mini day session trading. My estimate for today's day session range was 980-995. I got long near the open on a small reaction that ended at 981.50 and added to the position after the market made a new high for the day. The opening 30 minutes was very strong and since early strength generally continues for the first 2 hours or so I thought I would try hold on for a move to 1000 or so. But the market stalled a point shy of the top of my original range estimate. I didn't like the steady drift downward from the day's high so I decided to accept a smaller profit than I had originally anticipated figuring that half a loaf is far better than none at all.

One rule of thumb I find useful is that within an up trend the market often will advance into new high ground by an amount equal to either 50% or 100% of the size of the preceding reaction. In this case the reaction was 15 points and adding that to the 980 temporary top level gives 995 as a reasonable target (purple rectangles).

The move up from the 865 low of early July has not been corrected in any substantial way. This makes me think that the thrust upward from the 965-980 trading area is going to be relatively brief. I think the next break will amount to 25-30 points and will probably stop somewhere near the lower green dotted trend line. Midpoint support is at 972.

The next significant midpoint resistance level is at 1015. This is the midpoint between the September 2008 rally top at 1291 and the November 2008 low at 739.


Johan Nilsson said...


Besides the day trading do you hold long positions in stocks?

karen b said...

thanks so much for the chart (s) they really help.

SpideR said...

I want to show you something.

Take a look at your post from
Record Bearishness
Do you see the Time Cover with
Holding on for Dear Life ?
It is above
Guesstimates on March 9, 2009
Wich was the bottom.
Ok so from a contrarian perspective.
Look now at the last covers magazines. like Newsweek

Carl Futia said...

I have already commented on that recent Newsweek cover at

Narayana said...

Was the last hour of trading on Thursday a supply shock?