Channeling the Reindeer.
Just a quick bit of semi-useful numbers. I’ll include this in tomorrow’s Broken Clock.
The SPX pushed a pin through the trend line “Since Oct 21” and remains within spitting distance. Everything that I wrote yesterday still applies. I’m looking at that red ’13’ from two days ago and thinking that TD’ers everywhere are looking for the retrace (sure…. like on Nov 9th. heh.) TA explains where the market has been. It doesn’t tell you where it’s going. But it sure will help you manage your risk. Every time you place a trade, the market can go either up or down in your preferred time frame. However you decide which way lies your conviction, the fact remains that you can be wrong. I know that there are sharks in the ocean – yet the coastlines are full of swimmers. Just because all the facts indicate that the market should be falling does not mean that it will. Swallow your distaste and play the moment with your instinct, not your brain. The IBs desperately need the greater fool to take them out and you can be sure that they will be leveraging every FED program to the hilt to make equities look attractive. Use TA to pick your spots to go short. BUT, also use TA to pick your spots to go long. It’s a trade, not a life-choice.
It’s 6PM EST, just after lock-up. ES is looking like it’s testing support in a short term channel, and a TD risk level at 1131.50. This is a good place to play long with the stop-loss below that 1131.50 point. I’ve drawn the channel that ES has been running in since open on Wednesday. No reason to believe that this won’t continue in the AH reindeer games. I think the upside is limited in the way that daily ES is pushing into the nose of the wedge. If ES gets below the channel a short might be a good idea after the lower trend line of the channel is retested. Pivots:
- R2: 1140 = Could be new highs.
- R1: 1136.50 = Resistance overhead for now. Would also be a new high
- Neutral: 1132 = ES is just stepping out onto this floor at this time
- S1: 1128.25 = part of the support band from Jan 06, 2010.
- S2: 1123.75 = Support from the Dec 30 – 31 overnight.