Asian and European markets trading up, US trading higher as there are no new major developments in the Libya situation. The level of fear in the markets seems to have subsided, at least for the short-term.
US GDP numbers showed that the economy was not as strong as initially expected coming in at 2.7% versus 3.2-3.4% expectations. No major market reaction followed the numbers.
The S&P 500 is down more than 2.5% on the week. This is the largest weekly decline since August of last year, basically since before the current bullish up-trend began. We'll see where we close the week.
Its still too early to tell, but yesterday's lows could mark a potential end to the latest wave of selling. Technically, the current up-trend channel is still in-tact. It is important to see how the markets trade today. I am currently neutral, though I have a bullish bias intra-day. There is significant resistance above and the ES will need to trade through it before we can know if the current weakness has subsided. I wouldn't be surprised to see a move up towards 1320 today on the ES. I like shorts off that level for now and I currently like long entries around 1304.
Middle-East/North Africa continues to be a wild card. Breaking news from the region could influence a change in direction at any time.
Levels to watch today on the ES:
Resistance above at: 1312-1314, 1319-1320, 1323-1324
Support below at: 1304-1305, 1299-1301, 1293-1295, 1290, 1285-1286, 1277-1279
Friday, February 25, 2011
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