European markets saw some gains overnight and some good news this morning regarding a drop in initial and continuing jobless claims, a better than expected increase of durable goods orders and an increase in personal income helped the US markets rally today on low volume.
I'm favoring a market sell-off over the thanksgiving holiday and suspect there is a good chance of a gap down to begin the next week of trading. The key confirmation will be a move back below today's lows. When that happens, ES should trade down into the low 1160s.
That being said, the current action appears bullish, there is potential further upside in the coming days to 1206, 1213 and as high as 1217 on the ES. I will look to get short at any/each of those levels.
How to trade those scenarios? One way would be to get short somewhere around today's highs. Don't defend any move above 1199-1200 (ES). If we break above those levels, wait for 1206, 1213 or 1217 before getting short. If those levels aren't tested on an up-move, look to short the market after it confirms back below 1198. I will comment when I think there is a good buying opportunity. As of now, I am looking at potentially the low 1160s. We will have to wait to see how the market trades down before knowing the best level to buy into.
See you next week, I'll be back after the Thanksgiving holiday...
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