Initial claims and continuing jobless claims both came in lower than expected, but the market doesn't care. Positive news like this is insignificant in today's bear market conditions. ES traded lower than yesterday's lows after a brief rally in overnight trading was rejected. Although it appears that the market is trying to make a base here around 1100 (ES), I'm not convinced it will hold. I expected Tuesday's rally to have a bit more strength, but the ES wasn't able to move to my 1200 target. While still a possibility, I see it as less likely now.
A new low is a significant possibility today. If the ES closes below 1077 (whether today or in the coming days), 1000-1020 is likely the next buying opportunity.
I will consider buying dips and selling the rallies as long as resistance remains strong in the mid 1100s and support holds in the lower 1100s. I expect to see support break down first.
Thursday, August 11, 2011
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