The ES broke down below the lower consolidation support on Friday after some political posturing about a government shutdown. The weakness was short lived however, as support held at 1319 and the ES closed the day back within its 7 day consolidation range. I remain neutral in my current market bias.
It will be important to see how the markets open today. I will be watching the 1329-1331 price point. If resistance hold there on the ES, that may point to continued weakness on the heels of Friday's sell-off and we could see a move that could take the ES down to 1310. I would consider long entries from there. If the ES moves above 1330-1331, I will expect a move back to the upper levels of the consolidation channel.
Levels to watch on the ES:
Resistance above at 1329-1330, 1334-1336, 1338-1339
Support below at: 1323-1324, 1320-1321, 1314-1315, 1310-1311
IN THE NEWS:
U.S. lawmakers reached a budget deal by the Friday deadline, which cuts spending by $78.5 bln from the President's FY11 budget request. The two sides agreed to cut $13 billion from funding for programs at the Departments of Labor, Education, and Health and Human Services as well as over $1 billion in a cut across non-defense agencies. There will be reductions to housing assistance programs and some health care programs along with $8 billion in cuts to budget for State and Foreign Operations. The question is, are these cuts too little too late?
ECONOMIC DATA THIS WEEK:
Earnings season kicks off this week, with Alcoa reporting today after the bell.
Retail Sales on Wednesday at 8:30am EST
PPI and Jobless claims on Thursday at 8:30am EST
CPI on Friday at 8:30am EST and Industrial Production at 9:15 EST
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1314-1315 is the next spot to look for a long entry today. We could get as low as 1310 where I will be a strong buyer... But really I'll be looking for support in th 1310-1315 area
ReplyDeleteI don't see any strength in this end of day bounce. I expect lower lows...
ReplyDeleteToday's end of day bounce came off the S1 support on the S&P cash index. This coincided with the 14 day average daily range on the ES. That was enough to give us a little end of day bounce.
ReplyDeleteIt will most likely be short lived as I expect a a move down into the trading range from 3/29 either tonight or tomorrow.