S&P 500 Emini Day Trading Gap Tuesday February 16, 2010

S&P 500 Emini Futures Day Trading THE GAP

S&P 500 Emini Day Trading Gap Tuesday February 16, 2010

S&P Emini 500 Futures gapped down over 11 points at the open, and rallied back to fill the gap on good volume.  So much for the theory of low volatility and volume on a Friday preceding a holiday week end. The close for the S&P Emini 500 Futures gapped down over 11 points at the open, and rallied back to fill the gap on good volume. week was up from the prior week on nearly as much volume. The index looks to test the 1100 level, then resume the down trend to the 1025 level. That will test the 200 ma, supposedly a buying spot for institutional traders. We shall see. A move above 1100 with validation will signal a possible resumption of an up trend.

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S&P500 Emini futures support and resistance

Friday 2/12 opened at 1064.75 coming off a down trend during pre-market times. The down trend continued until the resistance area around 1060 was hit, sideways action occurred until roughly  11:00am EST when crude inventory news release occurred. A strong up trend occurred until 1072, close to the 1075 resistance line that price action hit twice this week but could not overcome. This same resistance (1075) was challenged a few hours later, but again it was not overcome. It would not be until market closing that enough buyers came into the market to break this resistance line with price reaching 1080 and then dropping. Half of the day showed a pattern of higher highs, giving a great trading channel closing at 1075.50. On long term charts higher highs were noted this last week until Friday, giving a double top possibly indicating a break of this channel. Look for possible down trend on Monday testing the strong resistance at 1060. If it breaks this resistnace the next floor i! s at 1040. Ceiling resistance lines at 1080 at 1100.

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Forex trading Friday Market Wrap

€ The euro depreciated vis-à-vis the U.S. dollar today as the single currency tested bids around the US$ 1.3530 level and was capped around the $1.3695 level.  The common currency continues to retreat lower as risk aversion becomes heightened.  Greek credit default swaps for five and ten year sovereign debt continue to widen as do the default swaps for Spain, Portugal, Italy, and Ireland.  Traders generally believe yesterday's announcement by European Union leaders lacks teeth insofar as it did not commit a specific level of capital to confront Greece's financial difficulties.  The most likely scenario, however, is that Greece will eventually receive bilateral aid from at least one eurozone country, with Germany the likely guarantor.  European Central Bank President Trichet said he will work with the European Commission on proposals for additional Greek measures.  ECB member Stark said a lot of ideas being suggested to help Greece are "counterproductive."  In addition to the threat of contagion to other eurozone countries, dealers are paying close attention to the resumption of escalating credit risk in the Middle East.  Dubai credit default swaps are 18 bps wider today and some traders are speculating the emirate could be facing bankruptcy.  There is also a fear that Dubai credit jitters could spread to other countries around the Gulf.  Data released in the eurozone today saw Q4 2009 gross domestic product climb a weaker-than-expected +0.1% q/q. Also, French Q4 2009 GDP came in stronger-than-expected at +0.6% q/q and German Q4 GDP printed flat q/q, below forecasts.  Additionally, it was reported that EMU-16 December industrial production was off 1.7% m/m and off 5.0% y/y. In U.S. news, January retail sales were up a stronger-than-expected 0.5% with the ex-autos component up 0.6%.  Also, the preliminary February University of Michigan consumer sentiment indicator fell to 73.7 from the prio [...]

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