Wednesday, January 02, 2008
Cash S&P 500 and E-minis
I was stopped out of my long position in the e-minis at 1461. I have been expecting the market to embark upon a sustained uptrend but instead we have had wide fluctuations within a trading range. The fact that we are seeing even more weakness today after a two day drop means that the 1498 high on December 27 ( at 1511 in the e-minis) was a genuine lower top and after lower tops develop one generally should expect lower lows.
So at this juncture I think the drop will carry the cash down to 1425 or so and the e-minis to 1435. A low at these levels would mark the end of a three stage drop from the December 11 top and should set the stage for a move up to new bull market highs.