The morning lows held and stocks managed a recovery into the close. NQ did not make it to the pivot, but ES showed more strength. SMH got out of some pretty nasty trouble and closed back above its 50 DMA. QQQQ found support right above the January high (43.31) and that looks to be the line in the sand going forward (NDX 1761.50). Nasdaq new year highs at 58 and new year lows at 50. That range is tightening.
The S&P did not quite manage a close above its 20 DMA and found resistance at the ex trend line support from the July rally. Until SPX closes back above that level (now at 1388), the bears will be attacking resistance. Futures traders watch ES 1388.50, 50% November and current overnight support.
Keep an eye on the BIX. It is showing a potential recovery in the making if it can start trading above 391.
I don't think we are done with this correction, there is still lots of froth, but if NQ can manage to hold on to its 20 DMA, now at 1776, and SPX gets back above 1388 and holds it, shorts could get jammed and we could see a rally. If that happens, NQ/NDX/QQQQ 10 DMA will be resistance. This is a trader's environment, so act accordingly and don't stay committed to any side for very long.
The S&P did not quite manage a close above its 20 DMA and found resistance at the ex trend line support from the July rally. Until SPX closes back above that level (now at 1388), the bears will be attacking resistance. Futures traders watch ES 1388.50, 50% November and current overnight support.
Keep an eye on the BIX. It is showing a potential recovery in the making if it can start trading above 391.
I don't think we are done with this correction, there is still lots of froth, but if NQ can manage to hold on to its 20 DMA, now at 1776, and SPX gets back above 1388 and holds it, shorts could get jammed and we could see a rally. If that happens, NQ/NDX/QQQQ 10 DMA will be resistance. This is a trader's environment, so act accordingly and don't stay committed to any side for very long.
This entry was posted
on Tuesday, November 28, 2006 at 11/28/2006 07:03:00 PM.
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