Hope everyone down under had a nice Australia Day. Coming back to work after a boozy Thursday is pretty tough, and lets see if there is any volume today.
So last night the S&P500 made a high of 1333 and then sold off all day long. You know that I have been looking for a top since the S&P500 hit 1300 and you know that I have been early. I do find it interesting that the S&P500 low back in March 2009 was 666.5 and if you multiply this by 2, we get last nights high at 1333. Looking at all the major US cash charts, we now have a Daily reversal candle out of clear resistance zones. I have shown these resistance zones on multiple occasions in the Nasdaq, DOW Indutrials and S&P500 so I will not do it again here but pls see my last post: http://swingtradersedge.blogspot.com/2012/01/you-cant-fight-fed.html.
Is the top in? I don't know but here and now is as good a place as any. The market tried to push on post the FEDs announcement but got slapped back down. The Nasdaq Futures tried to breakout but failed. That is all interesting information. A 20pt move from high to low was one of the biggest pullbacks we have had in a while. Thus very simply, I will be looking to short pullbacks vs last nights high on the S&P500 Eminis with stops above 1335. I will look to get flat and/or buy at 1305 to 1310.
S&P500 Eminis 60mins i
Hits top end of channel and reverses
S&P500 Eminis 60mins ii
Sharp red reversal candle and one of the biggest reversals we have seen thus far. Support still remains 1300/1305. Only a move below there would confirm a bigger picture top.
Nasdaq 100 Futures 15mins:
I also think it is interesting that so many markets in Asia are also hitting key resistance areas. Some such as the Kospi show clear reversal candles.
Hang Seng Daily:
Shanghai A Shares Daily:
Breakdown and retest
To Australia today. We are indicated at 4250 with Sycomm highs at 4280. I don't have a clear setup today but on Wednesday certainly there was a shift in the character of the market from bearish to bullish. Was this a one hit wonder and bull trap? I am not sure and we can only deem this a failed breakout if price closes back below 4220 Cash. All the banks showed very strong breakout candles last trading session and we should use these as a clear marker i.e. if price breaks through Wednesdays low, that is bearish.
My SPI range today: 4220 to 4255. Outlier levels 4200 and 4280.
My SPI day trading plan today: I am looking to short the 50s if I see a bearish reversal candle for a quick fade. 4220 was solid support last trading session and I will look for longs there and at 4200. The short term trend is up so I will focus on this unless we crack through Wednesdays low.