Friday, May 21, 2010
Here is a thirty minute bar chart showing day session e-mini trading. I estimated a 40 point range for the day with a low at 1035. So far we have seen a 37 point range but the low was 1051. This surprised me because I thought once the market broke its 1056 low of May 6 it would drop much more than 5 points below it.
So far the rally from 1051 has been only a little bigger than the biggest rally on the way down from 1174 (blue rectangles). Unless and until the market shows strength above 1100 I am going to stick with my guess that we shall see 1035 before a sustained rally to new bull market highs starts. Note that the initial leg down from 1074 carried about 60 points. A 60 point drop from the high (thus far) of today's rally would put the ES at 1028.