SP 500 Index Futures - Cooler Heads Prevail

Technically the MKT is pressing the EXTREME of a BEAR TREND move and may need a sideways session or two before it can extend lower. Don't risk too much hoping for it however as the momentum is down and sellers have probability on there side.

1043.50 is the Inflection Pivot keeping the Index in an aggressive sell posture. As long as the MKT is below here it is vulnerable to further losses. Key off the 1012 support pivot as this is the breaking point for a new move south. A failure here should pull the rug on the contract, if not a sharp positive reaction should be expected.

On the SELL side downside BREAKOUT strategies are valid below 1012 but will struggle sustaining new move lows at this time. Get in to these trades sooner (higher) than later (lower) as new weakness is expected to be stop and go. A more conservative strategy is to FADE a positive reaction after a negative breakdown signal against 1027.75 and even better to wait for a REVERSAL off this corrective rise rather than stepping in front of int. FADE and REVERSAL are recommended at 1043.50 especially after a sharp corrective rise. The MKT is negative but is also extended and the probability of a corrective rise is high.. Wait for an exhaustive signals or confirmation to jump on.

On the BUY side BREAKOUT strategies above 1043.50 should have aggressive trail stops and tighter profit targets. There is a good chance for a corrective turn but profit targets and position management should be tight as this is more likely a rally to sell. If you get on, ride it until structure is broken and then look to go the other way. BUY REVERSAL strategies off 1012 and in the 975.25-962.50 area will provide opportunity off of lower support inflections but will work best after a sharp trade lower through major support. Expectations are for no follow through not a reversal of sentimnet. Keep risk management and profit targets tight to reduce giveback as the underlying technical foundation today is negative. Avoid FADE BUYS as the negative trend remains enforce with sell FADE opportunities the better place to step out.

Note: Just because the MKT is extended does not mean it cannot get more extended. Wait for a signal don't force one.

 

JS

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CRUDE OIL Futures - VULNERABLE

Technically the MKT is in a BEAR TREND ACCELERATION technical state and flirting with the lower extreme. The MKT has produced a big negative signal and any positive corrective action is expected to be short lived with only one upside "stop sweep" if the negative momentum is going to play out. Any held strength and repeated probe higher is a sign that the trade will turn digestive. This does not take away from the negative bias but does limit the profit potential for any new sales in the session.

Key off the 77.37 Inflection Pivot. This is the high point for any positive squeeze. Notable resistance at 76.50 has the potential as well to put a cap on any buying.

On the SELL side accept FADE, REVERSAL and BREAKOUT strategies below the 77.37 Inflection Pivot. BREAKOUT below 74.76 may need to be "worked" as the MKT is on edge and will be emotional, producing some starts and stops before it drops. FADE strategies are recommended over REVERSAL strategies as the MKT is expected to hold lower structure and any momentum shift should be considered a potential positive corrective turn.

On the BUY side avoid REVERSAL strategies off major support levels as these signals are more likely short squeeze rallies and opportunities to SELL into and FADE. BREAKOUT strategies above the 76.50 and 77.37 are a long shot, so risk less and go for more. Any BUY FADE off the 74.76 or 73.02 support levels should have confirmation and are not recommended if the integrity of the previous session high is intact. After a break in the negative structure confirmed support levels can be used for short term reactions using aggressive position management.

Note: The MKT is on edge and is vulnerable to a big drop. If the previous session high is intact its just a matter of time before the sellers try to overwhelm the MKT. Look for excuses to get short. If the previous session high is breached opportunity will be on both sides of the MKT, however the bias still rests with the Bears.

JS

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Eurex BUND Futures - MIXED SIGNALS

The MKT has produced a big positive signal and is flirting with a resumption of the BULL TREND, however it currently remains vulnerable to further corrective action with all trading below the 12872 Inflection Pivot. This is the hurdle the market must overcome to confirm yesterday's positive signal.

On the SELL side accept FADE strategies on the initial test against 12872 or at the previous session high only. Repeated tests are expected to give way to higher prices as above the previous session high the corrective structure will be broken confirming the positive signal. Avoid REVERSAL strategies as any violations of resistance are positive. SELL BREAKOUT strategies below 12823 and 12776 are valid but aggressive. The MKT has produced a positive signal so if it does not follow through a negative turn could have some potential. Either way have a defined exit strategy as any negative action will be counter trend.

On the BUY side accept REVERSAL signals off all major inflection levels expecting the underlying positive tone to resume course. FADE strategies off 12776 should work on the initial test. The MKT has generated a positive signal and if it is going to follow through it should just go. Work any BUY BREAKOUT strategies above 12872 as any positive shift in momentum has the potential to be the start of the next leg higher.

Note: the MKT has produced a major technical buy signal and is poised for a resumption of the BULL TREND. Look for excuses to get long above 12872 and be weary of a difficult trade below this price point..

JS

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SP500 Futures - CORRECTIVE

The MKT has produced a positive signal and is flirting with a resumption of the BULL TREND.

Key off the 1120 Inflection Pivot for an indication of the session tone. Below here the Index will continue to search for a corrective low point with 1088.50 the expected bottom or any further corrective action. A rise above 1120 and the underlying positive momentum with be back in launch mode.

On the SELL side accept FADE strategies against 1120 on the initial test of major resistance below or at the previous session high only. Repeated tests are expected to give way to higher prices as above the previous session high the corrective structure will be broken confirming the positive signal. Avoid REVERSAL strategies as any violations of resistance are positive. SELL BREAKOUT strategies below the 1103.75 support pivot are valid but aggressive. The MKT has produced a positive signal so if it does not follow through a negative turn could have some potential down to 1096 and 1088.50. Either way have a defined exit strategy as any negative action will be counter trend.

On the BUY side accept REVERSAL signals off all major inflection levels atr 1103.75, 1096 and 1088.50 expecting the underlying positive tone to resume course. FADE strategies should work on the initial test. The MKT has generated a positive signal and if it is going to follow through it should just go. Work any BUY BREAKOUT strategies above 1120 as any positive shift in momentum has the potential to be the start of the next leg higher.

Note: the MKT has produced a technical buy signal but remains in a corrective trade. Look for excuses to get long on qualified signals but respect the corrective posture.

JS

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SP500 Futures - SENTIMENT SHIFT

The SP500 is set for a drama day as it is currently flirting with a sentiment shift. A held trade above 1122.75 points to a higher trade targeting 1147.50 on any momentum breakout. Don't fight any positive structure as a railroad advance up to 1174 will be in play.

A trade under 1122.75 puts the MKT back in a digestive posture down to 1113.50 and 1104.25 Inflection Pivot. Either price point has the potential to be the low for the expected consolidation, with a close above 1113.50 needed to keep the underlying positive shift intact. Only below 1104.25 is a negative turn anticipated down to 1084.25. No follow through is expected, however 1041.25 is the current lower extreme.

JS

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Dec'10 CORN Futures - TIME TO PLAY A CARD

Technically the MKT is in NEUTRAL TRANSITION and difficult trading conditions are expected. The MKT has produced an aggressive sell signal which should weigh on the MKT today if the signal is valid. If the integrity of the prior session's low remains intact a return to a sideways trend less trade is likely. Roll with any new weakness and leverage up if good risk parameters present themselves. The potential to get in at the beginning of a new move lower is real.

Key off the 371-2 Inflection Pivot as a trigger pointto confirm the sell signal. A held trade above this price puts the signal in question.

On the SELL side be more aggressive after the 371-2 level is taken out. Not that this is a pre-condition but should be noted as a confirmation of weakness. BREAKOUT strategies below 371-2 should just "go" so keep risk parameters tight. FADE into any positive reaction off an unsuccessful downside BREAKOUT after a resistance level is confirmed. Use a REVERSAL strategy to leverage up back under the original failure point. If the integrity of the previous session low remains intact, avoid REVERSAL strategies as expectations are that the "negative" signal is going to follow through it should do so straight away and any break in the negative momentum is a positive signal that the MKT is going to return to its neutral posture. FADE strategies are recommended early in the session or near the end. The negative signal will either play out from the get go or will weigh on the MKT in the latter stages of the trading session.

On the BUY side REVERSAL strategies can be executed off of major support levels at or near the previous session low point or at 371-2. Avoid this strategy on lower levels as any new weakness has the potential to be the beginning of a move. If the integrity of the previous session low remains intact FADE strategies can be accepted at or near this inflection point on the initial test with tight profit target objectives. If the MKT has already had a reaction off this support area avoid this strategy. Use BREAKOUT strategies above 382-2 as a signal to FADE a negative pull-back after a confirm break in the negative momentum at 376-6. Only take this trade if the previous session low point remains intact. Otherwise this will be a SELL REVERSAL opportunity.

Note: This is a dangerous emotional trading environment. You should expect the MKT reactions to go a little further that you expect in either direction so anticipate this in your position and risk management.

JS

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NASDAQ 100 Index Futures: FUN AND GAMES

Technically the MKT is in a NEUTRAL CORRECTIVE state producing a negative signal against a positive trend. Opportunity exists on both sides of the MKT however buying breaks above the 1880.50 Inflection Pivot is the best bet. 1880.25 is the low point for any weakness today if the underlying posiitve momentum is going to keep pace.

On the SELL side avoid FADE strategies until after the previous session low point or major support level has been broken to confirm a negative shift in momentum. Until then a better opportunity will be a REVERSAL strategy but only off the 1st major resistance level at 1913.50. This is a one shot trade using a low risk big profit target criteria. The idea is that if the MKT is going to follow through on its negative signal any stength is just a "head fake " before it follows through. SELL BREAKOUT strategies below 1880.50 can be profitable but they are aggressive and should look to take profits and potentially REVERSE long at support targets. The trade is corrective and the underlying positive tone must be respected.

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 off 1880.50, which should have at least 1 if not 2 challenges to the support integrity before executing a long off it. BREAKOUT strategies above 1913.50 can risk a little more if current events and other MKTs of confluence confirm a positive posture with the expectation that the Bull Trend is going to resume. If not a better approach would be to FADE a negative "squeeze" reaction after a positve breakout signal at 1897 as the neutral technical position can keep the trend sideways.

Note: The MKT is in a corrective position with the potential to move in either direction. Keep your opinions to themselves and focus on what the MKT is telling you it wants to do. Don't fight it, roll with it.

JS

Learn more about JS Services Strategy Based Trading approach using CLEARBOX automated strategies! For more information please contact me at info@jsservices.com. You can also visit http://www.jsservices.com/ and sign up for a Complimentary FREE Trial.