While we knew the markets would likely trade quietly heading into a busy week of economic and Fed news, Monday’s trading was rather dismal outside of a few fifteen minute spurts. Tuesday’s action is expected to be much the same. Since the market is not likely to break out ahead of key news this week, look to play reversals at key zone with clear profit objectives in mind.
After Friday’s bullish end to the week, it’s clear the market remains quite healthy. However, we have the FOMC statement, the Fed Funds Rate, and the Non-Farm Payroll number that will anchor a week that will be heavy with economic news, which could greatly influence price in the days and weeks ahead.
We’re seeing weakness across the board during pre-market trading this morning, especially after the bulls were unable to convert the 1686 level in E-Mini S&P 500 futures, and the 3060 level in the E-Mini NASDAQ 100 futures. Rejections at these levels have sent the market lower this morning, but there are key support zones down below that the bears are gunning for, which the bears have defended during the recent advance.
If all you had to know was one level for Wednesday’s trading in Crude, it was 106.90, which delivered a huge 2-point move when price failed at this zone early in the session. That’s $2,000 per contract traded in a matter of 3 hours, which is tough to be beat.
The S&P 500 futures are getting closer and closer to reaching 1700, but the pace has been snail-like. I’ve said this all week, but today could finally be the day. No, really. If price can remain above 1690, there’s a great shot to test 1700 today. But as I’ve mentioned before, I’m more interested to see how the market will react once this level is hit. I’m leaning toward higher prices toward 1710 before any real signs of selling are seen. But only time will tell.
