Yesterday's downward price action suggested that more weakness is in store for the US markets. The only technical sign needed to confirm the weakness is a lower low, a move that would need to see the ES trade below 1293.50.
Asian markets, NIKKEI, TOPIX and HANG SENG all down big on the heels of the sell-off yesterday in the US. European markets, FTSE, DAX and STOXX also currently trading lower.
I won't be surprised to see the market consolidate between 1296 and 1312 today. We may have to wait another day to see a follow-through to the downside. I like shorts off the 1310-1312 today and/or selling the up-ticks into resistance. I expect the ES to make its way down to 1277-1280 this week. That should be a short-term buying opportunity.
Levels to watch today on the ES:
Resistance Above at 1305-1306, 1310-1312, 1319-1320
Support Below at 1293-1295, 1289-1290, 1285-1286, 1277-1278
Wednesday, March 2, 2011
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