Corrected dates
WEEKLY PIVOTS FOR WEEK ENDING 07-December -2007
R3 1515.25
R2 1507.40
R1 1491.50
PP 1460.25
S1 1445.00
S2 1436.50
S3 1429.30
ECONOMIC CALENDAR
10:00 AM ISM Index
Another gap at the opening, this time 20 E-mini SP points at the 1490.00 level and a double top at 1492.25 during the first 15 minutes of trading exhausted this move up.
All the indexes gapped strongly higher to start Friday's session but the selling volume gave them a daily downside bias, mainly for the E-mini Nasdaq futures that rallied more than 140 points during the past week. The E-mini SP futures opened on the 1490's area and double topped during the first 15 minutes reaching 1492.25 while the E-mini Nasdaq futures made a high for this leg up at 2129.25. The first pullback took the E-mini SP futures to 1486.00 where buyers came in and took it back to the opening range at 1490.50. The weakness on the E-mini Nasdaq futures helped the other indexes to start a volatile downtrend move full of swings, and once the market broke bellow the 1486.00 level felt steadily to 1478.50. A 1-2-3 bottom resulted in a bounce back to 1487.00 where a new wave of selling held at the 1480.00 levels before and "air pocket" forced the market down to a new low at 1473.00. Buying came in and boosted the futures up in to the end of the session to 148 6.25 closing above fair value. The E-mini SP futures showed relative strength during all the session but this can be consequence of the end of month activity by the funds. Once more people were afraid of losing this rally than to be short or without position during the weekend.
Friday's lows at 2075.50 on the E-mini Nasdaq futures were printed at the 61.8 retracement from the 1986.00 mid November low to the 2129.25 early Friday high, so after the clear rejection from those highs, the index will have to hold Friday's lows if the rally is set to continue; furthermore, the high on the E-mini RUSSELL futures completed the 50% retracement from the 833.30 high to the 732.70 November lows, and if these Fibonacci readings are not enough, the 13493 high on the E-mini Dow futures is just beneath the 61.8 retracement from the October 31 high to the November 26 low.
All these resistance areas acted very well after last week furious rally, and the indexes will have to break above them if this rally is not more than a countertrend move. It will be very hard for the markets to see a breakout to new sustainable new highs and trend continuation even with the seasonal bullish bias for the month of December. On the long term, not even an additional rate cut by de FED will help to climb a wall full of uncertainty about the mystery of what the banks have on their books.
This rally came with very good volume and, while it is possible that the recent price low may prove to be the low for the correction, there is still a high probability that the lows will be retested within a couple of weeks; therefore, we cannot be absolutely certain that a new correction price low will not be made.
So if the indexes will struggle during the next days to move down and consolidate near the highs, then we could see another leg up for this move, but if the pullback is strong, a test of the lows will be seen during the next weeks. I will follow closely as an indication for the next move a break above Friday's highs or the reaction of the markets to my weekly PIVOT at 1460.75 for the E-mini SP futures and the old high at 2072.00 on the E-mini Nasdaq futures.
For today, we have initial resistance at 1487.50-1489.25 on the E-mini SP futures and 2109.75-2112.00 on the E-mini Nasdaq futures, if those are tested and rejected during the first hour, they should offer a great shorting opportunity as we can have a down trend day with some volatile bounces. Above that, 1494.50-1496.75 on the E-mini SP futures and 2124.00-2125.00 on the E-mini Nasdaq futures is all we could see if the expected pullback is going to happen, but if those cannot hold 1503.00-1505.00 on the E-mini SP futures and 2138.50-2140.00 is all I can see before the markets get extremely overbought.
Initial support will be found at 1481.50-1479.50 on the E-mini SP futures and 2080.00-2078.50 on the E-mini Nasdaq futures, if those don't hold a test of Friday's lows on the E-mini SP futures at 1473.00-1471.75 and 2065.00-2062.50 on the E-mini Nasdaq futures will be the next checkpoint. If buyers don't step in at those levels, the trend will be turning down and the only support on its way to the weekly pivot (1460.75) is at 1465.50-1464.25 on the E-mini SP futures and 2046.00-2044.00 on the E-mini Nasdaq futures. GOOD LUCK
TODAY'S SUPPORT, PIVOT AND RESISTANCE LEVELS
S&P
Nasdaq
RUSSELL
Resistance 3
1503.00-1505.00
2138.50-2140.00
784.50-785.10
Resistance 2
1494.50-1496.75
2124.00-2125.00
778.90-779.50
Resistance 1
1487.50-1489.25
2109.75-2112.00
774.20-775.80
PIVOT
1484.25
2098.00
772.10
Support 1
1481.50-1479.50
2080.00-2078.50
767.70-765.60
Support 2
1473.00-1471.75
2065.00-2062.50
762.10-760.90
Support 3
1465.50-1464.25
2046.00-2044.00
758.40-757.10
Nasdaq
S&P
RUSSELL
FIBONACCI
FIBONACCI
FIBONACCI
2216.22
1523.40
810.45
2203.53
1518.85
806.35
2183.00
1511.50
799.70
2162.47
1504.15
793.05
2149.78
1499.60
788.95
2129.25
1492.25
782.30
2108.72
1484.90
775.65
2102.38
1482.63
773.60
2096.03
1480.35
771.55
2075.50
1473.00
764.90
2054.97
1465.65
758.25
2042.28
1461.10
754.15
2021.75
1453.75
747.50
2001.22
1446.40
740.85
1988.53
1441.85
736.75
DAILY PROJECTIONS
S&P
Nasdaq
RUSSELL
AS DAILY HIGH
1501.75
2112.00
783.40
AS DAILY LOW
1476.25
2058.25
765.20
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