Once again I am looking at a potential market top forming. The S&P has entered price levels that could provide stronger resistance than what we have seen previously during this run-up to new highs. I like taking any opportunities to short this market right now (this is speculative given the fact there are no negative signs other than the market being overbought), the key is to do it cautiously.
Watching the S&P cash index ($SPX.X); Though I am preparing for the possibility of a market top now ($SPX.X closed last week at $1293), there is potential for it to move over 1300 and as high as 1312. If the S&P cash sees a daily close above 1310-1312, all shorts bets are off. This would be extremely bullish and would be a sign to abandon any shorts...
Levels to watch today on the ES:
Resistance above at 1290-1291, 1295
Support Below at 1283-1284, 1279, 1274-1275
Earnings watch: Apple and IBM after the close.
Apple is down 4.5% in pre-market on the news that Steve Jobs has taken a medical leave of absence. See if AAPL earnings can send the stock back towards $350. I think earnings will have to beat expectations to have any chance of this. Best to Steve Jobs...
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Short ES at 1290.50
ReplyDeleteStill holding short position. Did get an initial 3 point move down on this short, but market didn't want to sell further. Will have to consider covering if we trade above 1291... No need to hold this short if it goes against me. Can always get back in...
ReplyDeleteScratch trade, cover at 1290.75. Look to get in again, perhaps later in the day. If we trade up to 1295, I will look to get short. Or at the next best opportunity...
ReplyDeleteShort ES at 1294.75
ReplyDeleteIn regard to this trade, I'll hope AAPL earnings don't beat expectations by too much... I like this level, decided to take the trade into the close amidst bullish sentiment and price action... Ideally, I will look for 25 points on this trade, but I may take 10 points depending on the action... Or, I will cover this trade for a loss if we see continued momentum to the upside in the overnight session
ReplyDeleteAnd on a side note, this is the second trading session in a row we see a close right on one of my key levels... Friday it was 1290, today it is 1295.
ReplyDeleteCovered the trade at break-even after AAPL destroys earnings and guidance. AAPL shares halted and I decided to get out of this trade for now and wait to see how the market plays out before deciding to enter another position. No need to risk further upside in this market. Remember, technical levels are only used as guidance. When the market backs up the guidance, then you enter at the most advantageous price as it best corresponds with the technical level...
ReplyDeleteAAPL crosses over $350 (as high as $357), a long awaited target of many, and has since sold back down to $345. The ES has also sold off since making a high of $1296.25. I was away from my computer so I didn't get the chance to get back into my short. In any case, there will be more opportunities to get short... see u tomorrow
ReplyDelete