B"H
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THURSDAY, OCTOBER 15, 2009
1250 S&P 500 Up Side Target BUT Profit Taking Along The Way Very Possible
B"H
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*DOW JONES INDUSTRIAL AVERAGE BROKE ABOVE & CLOSED ABOVE 10,000. THIS IS APPROXIMATELY THE 50th TIME THE DOW HAS GONE ABOVE OR BELOW 10,000 SINCE 3/16/1999, THE FIRST TIME THE DOW BROKE ABOVE 10,000
*S&P 500 REACHED 9/17/09 BULLISH INSTITUTIONAL BUY EQUIVALENT TO 1,0881 & APPROXIMATELY $108.81 ON THE SPY & CLOSED ABOVE 1 YEAR 500 DAY EXPONENTIAL MOVING AVERAGE. UPSIDE BREAKOUT POSSIBLE BUT NEAR TERM OVERBOUGHT. *LONG TERM UP SIDE TARGET REMAINS 1,250 ALTHOUGH PULLBACKS ALONG THE WAY POSSIBLE.
*$US NEW NEAR TERM LOW, "DXY" $75.21-NEAR TERM-SUPPORT POSSIBLE BETWEEN $75-$76. ULTIMATELY RE-TEST "ALL TIME" LOW BELOW $72 VERY LIKELY
*OPTIONS EXPIRATION FRIDAY MORNING-INCREASED VOLATILITY LIKELY-POSSIBLY TO UPSIDE
*TODAY-OCT. 15th ECON/DATA CALENDER:
6am Nokia 7:30am Goldman Sachs Earnings, 8am Citigroup, Pre-Market-Time Not Available: IBM, Google, Harley Davidson,
8:30 AM Initial Claims
8:30 AM Continuing Claims, Core CPI, CPI, Empire Manufacturing
10:00 AM Philadelphia Fed
1:00 PM Crude Inventories
After The Close Earnings Advanced Micro Devices
*NATURAL GAS REACHED BEARISH INSTITUTIONAL TRADE AT 3:54PM 10/14/09
The S&P 500 Broke Above It's Recent Range & Reached Bullish Institutional Trades From 9/17/09 Equivalent To 1,081 On The S&P 500 & $108.81 On The SPY. Initially, The Market Sold Off From This Near Term Overbought Levels But Buying Following The "Federal Reserve Minutes" Release At 2pm Pushed The S&P 500 Slightly Above Recent Highs. The Major Headline Was The Dow's Ability To Close Above 10,000 Since October 6th, 2008. Near Term The Major Us Indexes Are Overbought Although 1 Bullish Institutional Trade In The Nasdaq 100/QQQQ Indicates That QQQQ $43.293 Is A Likely Near Term Target. Long Term, Charts Indicate That As Long As Support Near Or Above S&P 500 943.85 Holds, The Index Has An Increased Probability Of Reaching Its Up Side Target Of 1,250. Near Term Charts Indicate Large Institutional Selling Into This Weeks Strength, But The Possibility Of An Upside Breakout Cannot Be Discounted. Overall, The Market Is Clearly Favoring Long Term "Long/Buy" Trades & Very Strategic Short Term "Short Trades". Some Amount Of Profit Taking Is Likely Near Term As The Indexes Are Registering Multiple Near Term Overbought Signals. This Friday Marks Options Expiration Which Traditionally Increases Intra Day Volatility & Often Adds Near Term Support For US Markets. With This In Mind It Is Important For Traders To Adjust Hedging Options, Stop-Loss Orders & Position Sizing Accordingly.
Recent Institutional Sales In The S&P 500 Indicate That If Profit Taking Ensues, There Is An Increased Probability The S&P 500 Will Hit These Approximate Levels:
1,075. 1,074.17. 1,066.64. 1,065.40. 1,058.45. 1,040.77. 1,025.52. 1,022.
SPY Approximate Corresponding Levels:
$107.4174 $106.6361 $106.54 $105.845 $105.449 $104.02 $104.0774 $102.552 $102.20
The Level Of Selling Registering At The Approximate 1,074.17 Level Is Quite Significant & Indicates That There Is A Highly Increased Probability This Level Is Reached In Relatively Near Term Trading. It Is Again Important To Note That Upward Momentum From October 2nd At 9:30am Has Been Quite Strong & That Appropriate Risk Management Is Essential For All Trades. Despite The Near Term Overbought Indicators & Institutional Selling, It Is Important To Take Into Recent Upward Momentum In Any Trading Decisions. A Pullback To S&P 500 1,074.17 Is Highly Likely Near Term But Continued Upward Movement Especially Through Fridays Options Expiration Is Entirely Possible. As Always, Risk Management Is Key.
$US HIT NEW RECENT LOW. "DXY" $75-$76 MAY CONTINUE TO PROVIDE SUPPORT BUT A RE-TEST OF "ALL TIME LOWS" SLIGHTLY BELOW "DXY" $72 LIKELY. A STRONG BOUNCE FROM SUB $72 LEVEL IS POSSIBLE.
As Noted Yesterday, The $US Continues To Make New Recent Lows Hitting $75.21 At 2:13am. Despite Tuesday October 13th Clear Break Below The $76 Level, The Rate Of Decline For The $US Has Slowed In The Past 2 & 1/2 Weeks Of Trading. Ultimately, It Is Very Likely That The $US Will Re-Test The "All Time Lows" Under $72 On The "DXY". Near Term, Continued Relative Support Between The $75-$76 Level Is Entirely Possible. The Ultimate Decent Down Towards Sub $72 On The "DXY" Should Provide Positive Support For US Stocks & Commodities. There Is An Increased Probability That Somewhere Near The "All Time Lows" The $US May Experience A Very Sharp Rally. Despite The $US Down Trend Form October-November 2008 & March 2009 "Double Top" The Level Of Support Near The All Time Lows Should Not Entirely Be Discounted. This Coupled With The Fact That The Majority Of Trading Funds Are Positioned $US Bearish Could & Very Likely Will Spark At The Very Least A Temporary $US Rally. While This Event May Be Several Weeks Or Even Months Away, It Is Important For Traders Commodities & US Equities To Take Into Account The Very Strong Possible Support Near "DXY" $72.
BOTTOM LINE LONG TERM TARGETS OF 1,250 S&P 500 & $US BELOW "DXY" $72 REMAIN. RISK MANAGEMENT NEAR TERM KEY
Intra Day Volatility Should Increase As We Move Closer To Fridays Option Expiration. Taking Into Account The Possible Near Term Up Side Breakout For US Indexes Despite The Near Term Overbought Levels Is Key. Adjusting Risk Management Measures To Deal With Increased Intra Day Volatility Is Suggested. Overall, Charts Continue To Indicate That The S&P 500 Should Reach Its Up Side Target Of 1,250 As Long As Support Above Or Near 943.85 Holds. The $US Could Find Near Term Relative Support Near Between "DXY" $75-$76 But Longer Term Appears Very Likely To Re-Test The "All Time" Lows Below "DXY" $72. When/If The $US/"DXY" Breaks Below $75 It Should Provide A Catalyst For Continued Near Term Strength In Commodities & US Stocks. Watching To See Where Support Develops On The Likely Re-Test Of "All Time" $US Lows Is Key.
For Further $US Detailed Technical Analysis Including Multiple 3rd Party Links Please Click Here:
For Updated Natural Gas Technical Analysis Including Reaching Down Side Near Term Target:
For Bullish XLF/Financial Index & Further S&P 500 Analysis Please Click Here:
Good Trading
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