Friday, December 01, 2006

No Surrender

Here is an hourly chart of the December S&P e-mini futures. I last commented on this market here.

I thought that the bear army had run out of ammunition and that support at the low of the last bull bar (in green) near 1399 would hold. To my surprise the bears had more bullets than I thought. You can see the wide range down bar showing trading during today's opening hour. Note the two previous wide range down bars started and ended at almost the same price as did today's !! This tells me that the same people are selling aggressively for the third time this week and at the same prices.

The question now is whether or not the bull army can hold its defensive line. I believe that support is now at 1390, the lower edge of Wednesday's opening gap and the start of that day's very bullish, wide range breakout hour highlighted in green.

I am going to bet that support at 1390 will hold and that the market will soon be on its way to 1418-20. If I am wrong and 1390 fails then I think the market will head down to1370 or so before its starts a move to new highs for the bull market.

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