Equities continued a correction through yesterday's session but have since seemed to stabilize. The S&P (CME:ESZ13) reached a low of 1774.50 following the release of yesterday's FOMC minutes, finding support at our major three star level and allowing traders to jump in for a great trade opportunity as noted here yesterday. After trading through the 1782-85 level yesterday, the market has used this as a resistance range heading into this morning. Even though data out of Europe and China missed expectations last night, the S&P has been able to consolidate higher. Traders will be awaiting PPI and Weekly Jobless Claims this morning in what should trade as a "good news is good news" atmosphere since this is a weekly gauge on jobs and the minutes have already been digested. The 20-day moving average comes in at 1768.50 and a new low and a close below here will help signal that the immediate momentum is dying out. The next major support level is 1757 and this must hold to avoid a more significant, but healthy, correction.
Resistance - 1782-85**, 1793.75-96***, 1800*, 1810-12.50***
Support - 1774.50-76***, 1768.50**, 1757***, 1742*
Crude oil (NYMEX:CLF14) is trading slightly higher this morning and nearly $1 off of the $93.47 lows last night. Crude has been building a small trend of higher lows in recent days as it looks to consolidate higher. Inventories showed a smaller build than expected yesterday and gasoline inventories showed a slightly larger draw than expected. The trend of large builds has been broken for three consecutive weeks now. We are looking for slightly higher prices as a great opportunity to short this market. Crude has failed to close above $94 all week and a close above $94.13 will be significant in signaling a consolidation slightly higher. Still, major resistance comes in at $94.94-$95.15 at previous highs and the 20-day moving average at $95.26. This level will pose significant headwind and could be looked to sell against today. Only a close above here could ultimately signal a further correction as we head into Friday and as we always mention, traders are more inclined to close shorts and speculate long into a weekend.
Pivot - a close above 94.05-94.13 will signal a consolidation higher
Resistance - 94.94-95.15**, 95.55*, 95.74**, 96.70-96.92***
Support - 93.17***, 91.50-91.60*, 90.40**, 85.46***