Friday, August 07, 2009


Here is a 60 minute bar chart of day session e-mini trading. The trend is up, and as you know I think that the e-minis have another 100 points or so to go on the upside before we see the next break of 70-100 points or so.

There is midpoint resistance at 1015 - defined by the September 2008 high at 1291 and the November 2008 low at 739 (horizontal blue dash line). The upper trend channel line (rising red dash line) I have been using is at 1014 or so today, while a progression into new high territory by 10 points would carry the market to 1014 (green arrows). So there is good reason to think the e-minis are going to have a hard time moving much past 1015 without first reacting 10-15 points.

For the moment I am relying on support at 1005-08, the zone of several tops during the past week (upper purple dotted line). There is stronger support at the midpoint of the last reaction (lower purple dotted line).

1 comment:

PM said...

Hi Carl,

By just barely a tick or so there was no confirmation of my buy signal, BUT... the cash did confirm the buy signal and so did the DOW, this can't be completely ignored even though the futures missed the signal by only a few ticks. The actual mathematical closing price had to be above 1006.94, therefore 1007.00 since the futures doesn't trade in that format. At the closing bell on the hour for the markets we were trading at 1007.00, it sold off and settled at 1006.40 fifteen minutes later. No confirmation, but the DOW and SP cash market did confirm their signals, this cannot be dismissed too quickly.

I decided to remain long at my entry price of 1005.00 despite the futures non-confirmation because there is too much other information telling me the market doesn't want to go down.

More than 80% of the stocks in the SP 500 are now above their 200 day exponential moving average. The exponential moving average is a more complicated formula and sets a higher standard than the regular 200 DMA. The last bear market in 2002 and 2003 when stocks were down and then began to rally off those lows was the last time this indicator rose to above 80%.

I believe we're now witnessing the birth of a new bull market and we'll see these markets move much higher very quickly.


Kindest regards,