WEEKLY PIVOTS FOR WEEK ENDING DEC. 21, 2007
R3 1532.50
R2 1518.50
R1 1511.50
PP 1498.25
S1 1472.50
S2 1462.00
S3 1448.00
ECONOMIC CALENDAR
8:30 AM NY Empire State Index
9:00AM Net Foreign Purchases
WEEKLY RECAP
A .25 reduction on the fed funds and discount rate didn’t give the bulls what they were expecting to be able to maintain a positive sentiment in the U.S. markets during the week. Concerns about weakness in the financial sector and rising inflation took its toll in the markets. But a good reading in the retail sales data area a clear indication that the risk of recession is not imminent.
The markets had a positive session on Monday with follow through ahead of the FOMC interest rates decision on Tuesday. Like a kid who did not get his Christmas present, the markets sold off once the .25 point interest rate reduction was announced as investors were expecting a more aggressive action from the Fed. For Wednesday, the markets opened with a huge gap up as a result of a coordinated effort from the Fed with other central banks to add liquidity to the markets. That gap reached our weekly R1 (first resistance level) printing 1517.00 on the December E-mini S&P futures; unable to hold the early gains, the markets ended slightly positive. Thursday gave us the first sign of inflation as the PPI readings were higher than expected, but a strong Retail Sales number kept markets afloat after a successful test of Wednesday‘s lows. Friday’s confirmation that consumer inflation rise and additional bad news in the banking sector, resulted in a 20 points drop on the E-mini S&P futures closing just bellow our weekly second support level at 1478.00.
The market opened lower just at our support level at 1487.00-1486.00 giving us the early buying opportunity that we were looking for. On Friday I wrote: “yesterday’s swing lows at 1487.00-1486.00 and 2096.00-2095.00 must hold any selling pressure”. The E-mini S&P futures rallied to the 1498.00 area which was immediately rejected as the index sold off back to the 1487.00 area opening range. A small rebound to the 1493.00 level was met with new selling pressure as the indexes were sold steadily closing in the weekly support areas and on the daily lows.
During last week I mentioned that the December E-mini S&P contract could reach the 1472.00-1460.00 area before a Santa Claus rally could drive prices back up; that price band has already been reached and the market should be close to a turn to the upside. This objective could be cut through, but I consider that would be only to create a little bit of panic and stop out the weak longs. This does not mean that the turn has to come today, because the chance of a wide down day, but it is not unusual to find an important high or low in the middle of December. This move down has been already a four-day move, so if it was only a countertrend move or a consolidation of the huge rally it should found support today. For today's trading roadmap, please read the full report.
TODAY’S SUPPORT, PIVOT AND RESISTANCE LEVELS
S&P
NASDAQ
RUSSELL
Resistance 3
1492.00-1493.50
2120.00-2122.00
771.80-773.00
Resistance 2
1487.00-1488.00
2107.50-2109.50
766.70-768.00
Resistance 1
1481.50-1483.00
2096.50-2099.00
759.60-761.40
PIVOT
1487.25
2102.00
761.60
Support 1
1473.50-1471.00
2085.00-2083.50
754.30-752.60
Support 2
1463.00-1462.00
2072.00-2070.00
750.80-749.60
Support 2
1458.25-1457.00
2063.25-2062.00
745.50-743.10
S&P
NASDAQ
RUSSELL
FIBONACCI
FIBONACCI
FIBONACCI
1531.01
2167.52
805.54
1526.24
2160.73
801.06
1518.50
2149.75
793.80
1510.76
2138.77
786.54
1505.99
2131.98
782.06
1498.25
2121.00
774.80
1490.51
2110.02
767.54
1488.13
2106.63
765.30
1485.74
2103.23
763.06
1478.00
2092.25
755.80
1470.26
2081.27
748.54
1465.49
2074.48
744.06
1457.75
2063.50
736.80
1450.01
2052.52
729.54
1445.24
2045.73
725.06
DAILY PROJECTIONS
S&P
NASDAQ
RUSSELL
AS DAILY HIGH
1492.50
2112.00
767.00
AS DAILY LOW
1463.00
2074.00
748.40
Support, Pivot and Resistance levels courtesy of Arturo Stern. He authors the E-mini Daily trading advisory which gives technical analysis on all the major stock index futures contract. For more of his analysis go to www.theminitrade.com Arturo can be reached at arthur@theminitrade.com
Futures and options trading involve risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets. This is neither a solicitation nor an offer to buy or sell futures or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed in this document. The past performance of any trading system or methodology is not necessarily indicative of futures results.
All the material contained here or in any communication is only for information purposes and part of our thoughts and personal conclusions.
