The S&P500 as well as the Dow Emini Futures both staged a very respectable recovery rally after suffering their single largest daily sell off of 2012 yesterday. With the exception of the second hour of today's Wall Street session, volatility has been visibly absent from the mix. Melt up might better describe the action than rally.
In quiet overning trading the S&P is just below the 1357/1358 Weekly Trading Zone we anticipated having now recovered 62% of the losses suffered yesterday. The Dow Futures are quiet as well currently treading water at the 12860/12865 Weekly Zone having recovered thus far better than 50% of Super Tuesday's sell-off.
S&P500 Emini Futures
SP500 (ES) 03/07/12
Dow Emini Futures
Dow Futures (YM) 03/07/12
As we wrote last night, these bounces were to be expected. The markets have been over extended to the upside for too long. Tomorrow is Roll-Over Day so be sure to check your Charts and Dom before placing any trades. In the Live Trading Room we will roll our contracts forward once volume on the new contract exceeds volume on the March contract. This could come as early as Friday or as late as next Tuesday. We will keep you posted.
Although the markets recaptured sizeable territory today, the manner in which it was done is somewhat questionable. Our final chart tonight will be the Euro 6E. This is a daily chart stretching back to last October. As CFRN Partners know, the White Candle represents a "potential change of trend". We pointed them out last week as they were forming. Should the market rally up to 1.3220 we will consider that a viable place to consider a longer term short position in the Euro 6E. There is a 7PM deadline in place tomorrow night and depending on the outcome, the Euro Zone could have one less member.
Euro 6E Emini Futures
CF_TC Trend Change Indicator
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