Defense wins games and defends market rallies

(CME:ESH14) - Defense Wins Games; Hedefunds Are Shoring Up Positions Before Next Week’s FOMC: Although the S&P spent most of last session in consolidation against the high part of its range, it was unable to close above the 1840.75-1842.50 level, being marked at 1838.50. However, shortly after today's session begun, poor manufacturing data out of China caused a sell-off ahead of the much anticipated Weekly Jobless Claims today. The low this session of 1828.75 puts in a higher low on the week and was held with better than anticipated manufacturing data out of Europe. Still with earnings to be reported from Microsoft, Lockheed Martin and Southwest Airlines among others today to accompany existing home sales traders have a full day ahead. A close below 1825-27 will signal a deeper correction to come ahead of next week's FOMC; the 50-day moving average comes in at 1805.25. The 20-day moving average comes in at 1832.50; a continued close above here will keep the bulls in control.

Resistance - 1840.75-1842.50***, 1846*, 1853***, 1893***

Support - 1832.50**, 1825-27***, 1815.75**, 1809.50**, 1805.25***

(NYMEX:CLH14) -Lock ‘N Load; EIA Inventories Crude And Nat Gas: Crude oil rallied through major moving averages yesterday as the southern leg of the keystone pipeline created a larger demand than anticipated in the cash market. The March contract traded through the 50- and 200-day moving averages, which come in at $95.87 and $96.10 respectively. Support began this week with China dumping cash in the tune of $42 billion into their financial system. However, news was shrugged off that the Iran Oil Minister will make an appearance at Davos to solicit investment from big oil companies after getting the first steps of a nuclear agreement in place. Furthermore, the market saw a slight pull back early with the first build shown in the API inventory report in more than a month. Still, traders will be awaiting official data out of EIA to follow jobless claims this morning. A major retracement level comes in at $97.23 aligning closely with the 100-day moving average which comes in at $97.59 today.

Resistance -$97.00 97.22***, 97.59**, 98.40**

Support -96.10**, 95.87**, 95.41*, 93.73**, 93.40**, 92.60**, 91.47***

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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