Stock indexes feel weight of correction after disappointing data

(CME:ESU13) - Due for a "technical correction," U.S. equities remained in a small range overnight hugging unchanged. European stocks as well as the Nikkei have fallen back this session after disappointing data across the board out of Japan, Australia and Europe. The major focus this morning will now be U.S. weekly Jobless Claims. As we believe a small taper is already priced in, a beat will likely help equities trade higher. Yesterday the S&P put in a convincingly bullish close above 1681 at 1688.75. There is no doubt that the momentum is higher and the next major target resistance is 1695.50; a close above here should set up the S&P to trade on the all-time highs heading into next week. A continued close above 1687 is needed to help maintain this momentum. Traders can look for a sharp pull back to 1681 as a buying opportunity but a close below here will be discouraging to the bull camp.

Resistance - 1687*, 1695.50***, 1700*, 1703-05***

Support -1681***, 1674.50**, 1666***, 1657.50**, 1645.25-1647.50***

(NYMEX:CLV13) - Corrective bounce and recent shorts take profits: Crude oil has been able to trade stronger once again today after holding $106.91 support upon a somewhat bearish inventory report. The fact is crude sold off very strongly beginning on the open Sunday night and followed through as developments emerged that an agreement with Syria will be forged. The fact is upon this news the market both electronically and on the floor could not close below the major $106.91 level on Tuesday and did not allow the bears to take control. Additionally there is no actually agreement in place yet and until there is, the market still needs a risk premium built in, and this is what it is doing as crude trades back above major resistance at $108.23 reaching a high this session so far of $108.61. Major resistance sits at $109.17 and an encouraging Jobless Claims number, which will show growth (supporting Crude demand) as well as likely weakening the U.S. dollar, which should bring a test to this level. A close above $109.17 could ignite a bull leg higher as we head into the weekend with geopolitical risk still on the table. Bulls can look to buy the $107.85-.95 level on pull backs. Aggressive bulls can look to the $108.23 level and risk to $107.30.

Resistance - 108.23** (watch on a closing basis), 108.60*, 109.17***, 110-109.85**, 111.50*, 112.55***, 115.00**

Support - 107.85-95**, 107.30*, 106.91***, 105.56-.88*, 104.89-105***

About the Author
Rich Ilczyszyn

Rich Ilczyszyn is Founder and Chief Market Strategist of iiTRADER.com. Rich excels at creating dynamic trading strategies for clients that establish solid positions, while remaining flexible enough to capitalize on market opportunities when they arise. By identifying market trends, breakouts, and failures in a timely fashion, Rich presents clients with the opportunity to realize their objectives while effectively managing their risk.

Rich is featured expert/trader and contributor on CNBC's "Futures Now" Show, and has been quoted in multiple of top-tier publications, including: The Wall Street Journal, Associated Press, Bloomberg News and Reuters.

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