The technical structure of the Mar'10 S&P500 Index futures contract has downshifted into a NEUTRAL CORRECTIVE. Expectations are for more difficult trading action in front of the roll with the 1127 Inflection Pivot the low point for any setback.
On the SELL side avoid FADE strategies against the 1151.75 resistance pivot until after the previous session low point or 1138.25 level has been broken to confirm a negative shift in momentum. REVERSAL strategies should be avoided as any positive signal is more likely an indication that the underlying trend is going to resume. SELL BREAKOUT strategies below 1138.25 can be profitable but they are aggressive and should look to take profits and potentially REVERSE long at the 1131.50 and 1127 support targets. The trade is counter trend so avoid any negative commitments.
On the BUY side accept BREAKOUT, FADE and REVERSAL strategies off major inflection points with the expectation that the positive momentum is going to resume. REVERSAL strategies are recommended over a FADE strategies at 1138.25 and 1131.50, which should have at least 1 if not 2 challenges to the support integrity before executing a long off it. The best buy FADE will be at the 1127 Inflection Pivot today. BREAKOUT strategies above the 1151.75 resistance can risk a little more if current events and other MKTs of confluence confirm a positive posture. If not a better approach would be to FADE a negative "squeeze" reaction down to the 1145 Directional after a positive breakout signal as the neutral technical position can keep the trend sideways.
Note: The MKT has produced a big technical signal against the current trend. Be aware that the negative action may be a 1-day event with the positive trend quickly re-establishing itself. If the MKT is really going to turn it should remain hard pressed and provide little or no relief.
JS
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