late night S&P update. Please focus on ES_F levels and the reasons behind why they were significant, specifically 1215.
Index tape reading is almost like interpreting a never ending meandering ancient scroll, you must remember significant events from the past while simultaneously applying the past's future outcomes when interpreting foreshadowing within the scroll. The same interpretations can be applied to the markets.
As for today....The markets looked as if they were going remain flat the entire day as the dollar showed its strength nearly from NYC open to NYC close. US dollar futures strength kept rampant Emini buying to a sane level, though it was not until big time seller came into commodities, specifically spot gold and silver sending GC_F futures down over 40 points from highs of 1424. A correlated market reversal is never a good
sign, i have been chirped this has not happened on such a scale since 1994. The market was giving us sniffs of future trading patterns all day with large US dollar future block buys and the repeated testing of ES_F day lows. The repeated testing of day lows is clearly a different type of trading pattern then we have seen in over two months.
The big levels today were clearly the pre market high of 1224.75 failing on volume followed by 1219, then 1217 and finally 1215 where the buyer had been showing up the past week or so. If you remember the 5 min chart i posted yesterday it looks very similar to the chart below, though the chart below includes todays price action. The chart above is a 1 min chart of the ES_F, you can clearly see the sharp and violent spikes down on volume through key support levels (Red circles). This is a very bearish signal.
As the 1215s failed a second time the party was on, especially after 1212s were sold like they were rabid puppies. The breach of 1212 really pushed the correlation robots and ETFs into a massive selling spree which carried the futures down to 1206.25 before the inevitable bounce shot the spooz back up to the 1212 level. Can we say stick save?
As for tonights session, 1212.25 appears to be resistance, though 1212.50 was briefly touched as US dollar futures came in a bit. 1208 is short term support. Gold futures have been poking and prodding 1399.30 but have failed 3 times in a row. Tomorrow look for continued correlation across normally no correlated assets. The 78 level in USDX futures is resistance, if breached to the upside we could see momentum traders come into the trade. When multiple markets confirm their inverse and or parallel correlations you as a trader can use these signals to reinforce your trades. The trade was: short gold, long dollar, short equities and commodities. IE selling risk assets..
A few thoughts.
The biggest moves happen when you least expect them.
Cover when you can, not when you have to.
This market can take away faster.
Tomorrow Calendar: all times eastern
|Nov 10||07:00||MBA Mortgage Applications||11/05||NA||NA||-5%|
|Nov 10||08:30||Initial Claims||11/06||450K||450K||457|
|Nov 10||08:30||Continuing Claims||10/30||4350K||4350K||4340K|
|Nov 10||08:30||Trade Balance||Sep||-$43.0B||-$44.8B||-46.3B|
|Nov 10||08:30||Export Prices ex-ag.||Oct||NA||NA||0.3%|
|Nov 10||08:30||Import Prices ex-oil||Oct||NA||NA||0.3%|
|Nov 10||10:30||Crude Inventories||11/06||NA||NA||1.95M|
|Nov 10||14:00||Treasury Budget||Oct||-$140.0B||-$140.0B||-$176.4B|