Monday Plan

Morning All

Looking like a relatively quiet open first thing this morning in Asia. There is a headline that has just hit the wires which states: "ECB says Greek PSI participation may fall short". Currencies haven't moved on this but it is early in Asian trade and  the big boys are not around yet. I'm sure this whole week is going to be dominated by confusing and misleading headlines as we approach the PSI deadline which will play havoc with the algos.

The focus for me in Australia today will very much be on this 4245/4250 level in the SPI futures. We continue to under perform overseas markets and the attempted move above 4300 was swiftly beaten down. Despite a positive lead on Friday morning, we popped and drifted lower for the rest of the session. Quite simply, we have a great breakdown trade here if this 4250 level does break looking for a gap fill at 4200 and possibly lower.

SPI 15mins:

SPI 60mins:
Are we looking at a failed breakout and a possible Head and Shoulders building on the 60mins timeframe?

AUD 60mins:
AUD continues to respect the levels with precision. I showed a great low risk short setup on Friday night into the 1.08 level futures. AUD hit a high of 1.0799 and then sold off for the rest of the session. Also a clear climatic reversal pattern, a failed "test" or rally, and now we are testing supports once more. If 1.07 breaks, this should really begin a new trend lower.

My SPI day trading range: 4233 to 4290. Outlier levels 4220 and 4205.

My SPI day trading plan: As I state every Monday, it is something of a lottery trying to call where we are going to open first thing. Fridays SYCOMM session indicates us at 4262 but no doubt we will deviate a small bit from this. I anticipate a retest of 4250 at a minimum. Quite simply, I will continue to buy 4245/4250 with very tight stops for scalps trades only. If we fail to bounce meaningfully from here, I will be very quick to look for the breakdown targeting 4230 initially and then as far down as 4200 (I doubt we see that today). This is the trade where the money will be made I believe. On the upside, Fridays highs at 4290 will be a great short fade level with stops above 4300. All action in the middle of this range is noise so pay heed to the price action and candles.

Thanks
Austin

Friday Plan

Morning All,

Well I'm pleased I covered something! Excuse me if I sound a bit cynical this morning but I just fancy a good old fashioned rant. Yesterday was actually one of the best trading days I have had in a long while so my frustration isn't born out of market losses. Perhaps missed opportunities. However, it's just that this market has become something of a joke to me. Just buy any dip. Just apply for a European banking license and get a 1 Trillion EUR handout or whatever it is to go punt on markets and tie up some loose ends. I doubt much of this money is actually being "lent" to businesses or for any other real purpose. Last night we had an ISM that missed big time, we had Oil exploding through the roof (just don't know how this is good for the economy) and what did stocks do? Yup, they went up. A good low liquidity melt up. Just to add to how farcical everything appears right now, the ISDA obviously came out and said that Greek debt "restructuring" certainly doesn't trigger a credit event and the bailout would not prompt payments on credit-default swaps. Of course. Why would it?

Breathe, breathe, relax.

Anyway, no new highs anywhere but probably only a matter of time. It makes me think that Thursdays sell off might just be a one day wonder.

 Yesterday I wrote (Emini S&P500):

"So for now, we have sold off into the first minor zone of supports. It is important to not get too ahead of oneself in these situations as the first dip in a uptrend usually gets bought. We have a number of supports coming in from 1350 to 1357. As per above, I have covered some of my shorts and will look to re-initiate on any bounces back up to 1370. I will hold a core position for sure given the initial confirmations and given the magnitude of this zone and because I am looking for a bigger swing lower from here. No doubt, I recognise that the lower risk play right here for short term traders is to look for buy setups into the uptrend with stops below 1350. All yours."

Ha "all yours". That certainly haunted me overnight. I have just re-iniatied more shorts back in this 70 zone looking for a possible double top trade but I will keep it real tight.

Emini S&P15mins:
That A=C move off the top proved to be the low. That first big dip always gets bought. Now looking for a retest of the previous highs at 1377 and failure. Otherwise, well its probably just going to keep going.

S&P500 5mins:
No new highs yet on the cash index. Looks like an overlapping mess for now.

DOW 5mins:
Interestingly, the DOW closed on its lows and did not get anywhere near to challenging its previous highs.

So all in all, I just don't know here. I think the best trade is to short a retest of that 1377 Emini high with tight stops but certainly the recovery off yesterdays lows was impressive. Furtheremore, given its end of the week, we will probably have to wait until tues of next week before a more meaningful sell off.

Perhaps its time for me to change markets and redirect my focus. One market that is actually respecting the technicals and trading within somekind of meaning is the Australian Dollar. On Thursday night we saw a sharp spillover from resistance and an impulsive looking move lower. In tandem with the bounce in stocks, AUD has rallied and is now challenging some great low risk short levels. This looks like a low risk fade to me in here with stops above Thursday nights highs.

AUD March futures 60mins:
That A=C long setup that I put up on the lows played out with precision and was the trade of the month. A rally all the way back up to the highs ensued. Now we have tested and clearly failed at resistance with a clear bearish reversal. Looking to now short the first retracement. Well here it is.

AUD March futures 15mins:
61.8 Fib retrace comes in here as well as the 1.08 level and previous failed breakout level. Should be a meaningful barrier and low risk short entry with stops above Thursdays highs.

To Australia. This is another market that has played out very well of late and I just need to keep the focus up here and not worry about whatelse is going on in the world.

My SPI range today: 4245 to 4290. Outlier levels 4300 and 4320. Outlier Supp 4230.

My SPI day trading plan: Given the overnight bounce, we are indicated at 4270 early. This market feels tired. We tried to breakout at the end of the month only to be firmly slapped down. Yesterdays bounce failed and we ended up closing right back on the lows. However, I recognise that the oil move overnight may give us a little added kicker today. More broadly, we are still stuck in a range from 4250 to 4300 and thus in the short term we must continue to trade around those zones. Thus, I will be looking to short fade a bounce to 4285/4290 with tight stops. Any move above 4300 opens up a retest of 4320 and would present a great low risk double top trade. Note yesterdays highs were 4275 and it looks like we may challenge this early so be wary if we fail straight up. On the downside, 4245/4250 remains solid. Buy it and sell it if it drops. I am keeping it that simple.

SPI March continous 60mins:

Thanks
Austin

Sometimes It Aligns

Morning All,

Yesterday was one of those magical moments which rarely ever materialise. Every setup I had on my screens played out, with market after market "testing" their previous highs and double top zones. Then it was a matter of pop and drop and we got it. I talked about these zones in yesterdays post: http://swingtradersedge.blogspot.com.au/2012/02/end-of-month.html. ASX200, HANG SENG, DAX, AUD and EUR- one by one these markets rallied into their previous highs and then failed, showing a significant reversal.

The Emini S&P500 popped to 1377 post the LTRO announcement and then sold off, gaining momentum to the close. On the 28th February I wrote:

"A ideal setup (Emini S&P500) would be a push above 1370 to 1375/1380 and then a sharp reversal back down below 1370. This would be a short signal for me".
http://swingtradersedge.blogspot.com.au/2012_02_28_archive.html

This is what we got yesterday and I added to my shorts in the mid 70s after the reversal.


Emini S&P500 60mins:
Major bearish reversal candle out of resistance. Clear failed breakout above 1370.

As per the chart above, last nights sell off now takes us into the first supports. One could even argue that this is a ABC type sell off from last nights high and thus a low is in. I have covered some of my shorts at 1360 BUT I do think there is a lot more under the hood for a deeper correction and thus I need to hold some shorts. Let me expand:

Last night volume was the best I have seen in ages with 1.1bln trading on the NYSE. Almost 800k of this was Declining volume. Advancing issues popped to 2100 on the open, making another lower high despite price making higher highs, and then reversed to close at 1018. This is bearish indeed. These are the exact breadth readings you want to see at major turning points.

And now for the price action.

SP500 Daily Cash:
Reversal Candle out of the Double top zone. Early days obviously but this is the first initial signs of confirmation.

SP500 Weekly:
I showed this chart to a colleague yesterday which once again emphasises the relevance of this 1370 level.

SP500 60mins:
And when we drop down a timeframe, I can see the final subdivisions of this impulse. I talked about the back to back Wave 4 patterns which implied one final push and I think we got that last night. Again, momentum is not following through to the upside despite price making a higher high. A convincing break below this 1365/1370 support would confirm a failed move higher and open up a move right back down to 1340 and possibly lower.

So for now, we have sold off into the first minor zone of supports. It is important to not get too ahead of oneself in these situations as the first dip in a uptrend usually gets bought. We have a number of supports coming in from 1350 to 1357. As per above, I have covered some of my shorts and will look to re-initiate on any bounces back up to 1370. I will hold a core position for sure given the initial confirmations and given the magnitude of this zone and because I am looking for a bigger swing lower from here. No doubt, I recognise that the lower risk play right here for short term traders is to look for buy setups into the uptrend with stops below 1350. All yours.


To Australia today. Yesterday I called for one more push up to the previous XJO cash highs as long as 4250 held, and we got this. The SPI popped through my 4300/4310 level before getting dumped into the close. Lots of month end shenanigans going on here no doubt. The 4250/4255 level will be key once again today and I can only call a new trend lower once/if this drops.

XJO 60mins:
Rallied right into the 4315/4320 target and then sold off into the close. No doubt a nice bit of month end window dressing going on here but don't worry, that stuff doesn't get investigated.

My SPI range today: 4250 to 4305. Outlier levels 4315/20 and 4230

MY SPI plan today: We are indicated at 4266 this morning given the reversal last night in the US. This takes us almost right back to yesterdays lows! I do think we have seen a short term high in the SPI and thus the highest probability trade is to look for shorts on a retest of 4295/4300 with tight stops. A move back up to 4315/4320 would be a more aggressive short. 4250 remains the key support level and I will be covering any shorts into here again and looking for scalp longs. If we cant bounce meaningfully out of 4250 then look for breakdown trades to 4230 and then ultimately 4200 in coming days.

SPI 15mins:
Pop above 4300 and then reversal. A break below 4250 would confirm a more meaningful high.

End of the Month

Morning All,

I don't want to go into too much detail regarding US markets in this mornings post. I see no reason to change my current view and setups which were all illustrated yesterday: http://swingtradersedge.blogspot.com.au/2012/02/looking-for-short.html. Seeing headlines of "DOW 13k, whats next?" does nothing but add to my grizzly outlook at this juncture.

I scaled into shorts in the Emini S&P500 last night with an average around 1370. We did see a initial fall given headlines coming out of Europe but this proved to be short lived. I have no idea if this will reverse or where it will top, and I will only add once I see clear bearish confirmation. For now I want to be positioned small as I just cant miss out on this opportunity. For now stops are above 1380.

For what its worth, I do think we will see a little bit more upside in the next 24hrs. A number of global indicies look like they want to and need to "retest" previous highs before any new impulse down can begin. We also have the LTRO announcement at 10.15GMT and this very well could prove a catalyst to the upside for this algo headline driven market. Shock and Awe have proved to be the name of the game from global central banks so why stop now? I believe EUR400-500 is expected by the market so watch out for a number in excess of that. I believe any strong pop would set up ideal conditions for a climatic bearish reversal.

As per above, a number of markets look set for a retest of their previous highs. If they get there, this would set up great Double Top short trades. This is how trends change:

DAX 15mins:

Hang Seng 15mins:

AUD futures 60mins:

To Australia. Yesterdays SPI plan and range played out very well indeed. I said:

"I think the strongest play is to short early into 4275/4280. If we fail to sell off from here early, then I could see the market rallying all the way to 4300 and possibly 4310. Thus, I will be short fading 4275/80 with tight stops and looking to cover in the 4250s".

4281 proved to be the top and we made a low at 4250. That 4250 level continues to be defended. To me, very simply you have to get short when that level breaks but for now, we are still very much in a range. Given what I have said above, I would not be surprised if we actually popped today and made a challenge for the previous highs and above. Its a tough call here as the cash market never hit those previous highs and we cannot rule out one more push.

XJO 60mins:

Fell short of the ideal target area. Will we try and make one final push into those levels at 4315? It could be argued that the current lower high is bearish and indicative of a truncated high.

XJO 15mins:

Key support zone held yesterday (4250 SPI). Thus, this does setup the potential for one final push higher as per the count below as long as 4250 SPI/ 4255 XJO holds.

My SPI Range: 4250 to 4300. Outlier levels 4230/4233 and 4310. This implies that the 4250 does not break. If it does, don't hang around.

My SPI day trading plan: Very simply, if 4250 breaks, I will be getting short looking for a bigger move down to 4230 then 4200. However, until that time I will remain open minded with the possibility for a push all the way back up to 4300 (unlikely today). I think the most probable play is a rangebound type day until we hear more out of Europe. Thus, I will be looking to buy 4250/55 with very tight stops and short fading 4265 and then 4280 with tight stops also. Breaks of 4280 open up a push to 4300/4310 and I will be getting long to join a retest of the XJO cash highs.

Thanks

Austin

SPI March 5mins:

Looking For The Short

Morning All,

There was a solid bounce off the lows in the US markets overnight which led to new highs across the majors.....just. I believe this now sets up for a perfect short trade in the next 24hours. Yesterday I wrote:

"A ideal setup (Emini S&P500) would be a push above 1370 to 1375/1380 and then a sharp reversal back down below 1370. This would be a short signal for me".

I believe this trade is now very much on track. Once again, despite the higher high, underlying advancing issues made a lower high coming at at 1600 vs 1800 on the 24th and 2174 on the 23rd. What I find very interesting is the back to back 4th wave type patterns i.e. Flats. Ultimately this implies that we are in the final throws of this impulse.

S&P500 15mins cash:

S&P500 Daily:
Right into the previous highs and the Double Top zone. Have to be anticipating a climatic reversal here.

S&P500 60mins:
There are clear momentum divergences going on into this clear 1370 resistance level. Furthermore, I can count an almost complete 5 wave advance into this recent high. Nice channelling, nice alts between 2 and 4, 3rd wave the strongest etc etc. Its all there.

The NASDAQ 100 looks tired at this 2600 level. The DOW Industrial is grinding higher and not impulsing in a clear wedge/overlapping type pattern. All in all, its setting up for me and now you just have to have a clear short signal/plan before pulling that trigger.

We are also seeing clear confirmation from Asian indicies. These are often the first to turn and are a lead indicator I have found. Yesterday the Shanghai A shares had a very significant reversal out of 2600. This is a clear climatic turning point to me and I see a decent pullback over the next week or so at a minimum. The Hang Seng is still grinding lower after making a high at the A=C target and 61.8 Fib retracement perfectly.

Shanghai A Shares Daily:

A shares 60mins:

Australia opened on its highs yesterday right into the sell zone, and trended lower for the rest of the session. .

XJO 5mins:

My SPI range today: 4250 to 4280. Outlier levels 4295 and 4300/4305.

My SPI day trading plan: Yesterday we trended lower for the whole day from high to low. Given the bounce in the Eminis overnight, we are indicated at 4270. Thus today is a question of whether we pop and drop to continue yesterdays trend, or are we going to have one more push into the highs? I really don't know the answer to this but I think the strongest play is to short early into 4275/4280. If we fail to sell off from here early, then I could see the market rallying all the way to 4300 and possibly 4310. Thus, I will be short fading 4275/80 with tight stops and looking to cover in the 4250s. Look to re-short if 4250s drop with a target down to 4220/4200 although very unlikely today. If we push above 4280, I will flip to long trades targeting 4300/4305

SPI 15mins Bearish Chart:
Target hit with a clear spillover and reversal. Breaks of 4250 will flip this trend to down and open up a genuine move lower.

XJO 60mins Bullish chart:
The XJO never quite made a new high. I could possibly label yesterdays move a C wave as part of a flat. We had something similar in the S&P500 overnight. This implies a retest and possbile break of 4315 before we begin a new downtrend. Thus if we dont sell early, be on the lookout for this.

Monday Plan

Morning All

I apologise but I am still having problems uploading my charts.

The S&P500 cash made a new high on Friday night and thus fulfilled my recent trade idea to buy in the low 50s looking for a retest of the recent high. Now it gets tricky. I think there is the potential for a pullback/reversal come Tuesday or Wednesday this week as once again this uptrend is running out of steam.

First of all, the S&P500 is now right at the 1370 target zone. No doubt I have gone early a few times but this is the nature of wide target zones. A ideal setup would be a push above 1370 to 1375/1380 and then a sharp reversal back down below 1370. This would be a short signal for me.

S&P500 Daily:

Despite price making new highs, breadth has really failed to follow through and shows some bearish divergences. For instance, NYSE closing advancing issues of late:

24th Feb: 1630 (closing Advancing issues)
23rd Feb: 2174
16th Feb: 2281
13th Feb: 2468

As u can see, despite price making new highs, underlying issues are just not confirming this recent push higher which is not healthy. Volume has also dropped off a cliff with only 640k on the NYSE on Friday which is the lowest reading I have seen for a while. Furthermore, we once again have clear momentum divergences on the lower time frames given Fridays test.

S&P500 cash 15mins:

I have often found Tuesdays to be my trend reversal days so I am on the lookout for climatic reversal candles out of the 1375/1380 zone in coming days.


Australia has now fulfilled the recent forecast I made for a retest of the highs also. Now things get very tricky indeed. We are at the top end of the range and thus some significant resistance. Furthermore, momentum is now clearly waning. However, the short term trend is up. Thus, I believe the smart play as a swing trader is to be getting out of longs and standing on the sidelines. I believe it will be very difficult for the market to breakout here without a consolidation pattern/range first. Thus I am looking for a climatic reversal pattern to short and if instead we get consolidation, I will look to join a breakout to the upside and focus on this uptrend once more.

XJO Daily:

Clear res zone here. Bull amrkets do climb a wall of worry but its tought to be long right here right now in the short term.

XJO 60mins:

My SPI range: 4250 to 4300. Outlier levels 4310 and 4350. .

My SPI day trading plan: It is always very difficult to give an accurate range on a Monday given the weekend influences. Furthermore, today we have a leadership vote at 10am which may have some influence on trade although I doubt it. Thus I think the best play is to wait and gauge the early price points. As per above, I think we are now at the top end of the range. I will be looking to short fade 4295/4300 with tight stops and looking to buy the solid support at 4250. Keep playing this range unless we see a clear breakout of either of these levels. I will join a break of 4300 SPI on the upside, which opens up XJO targets of 4335 and then 4350. Note the SPI March contract high is 4294 and thus if we do trade higher, reference those XJO levels instead.

SPI March 15mins:
Target hit and clear divergences for now.

Thanks
Austin

Friday Plan

Morning All,

I am having problems putting my charts up so I will have to update later in the day.

A quick note. The Emini S&P500 sold off on the cash open and put a low in right at 1350 before reversing strongly and trending higher for the rest of the day. I talked about buying 1350 to 1355 support zone yesterday and this trade played out nicely: http://swingtradersedge.blogspot.com.au/2012/02/thursday-plan_23.html. You just have to buy that first retest of a strong breakout level. I believe this market is now on course to retest the 1368/1370 high in coming days and would not be surprised if we get a bullish/climatic overthrow. 13 50 now becomes a key marker for the bears.

The AUD was a key lead for risk markets yesterday. There was an attempted breakdown early that triggered some sell stops,but then the currency immediately reversed and trended higher for the rest of the day. Once again, yesterdays ABC pattern here proved to be a great low risk support play: http://swingtradersedge.blogspot.com.au/2012/02/thursday-plan_23.html. I believe this opens up a move right back up to the previous highs also.

In Australia, the 4250 SPI level (4265 cash) remains a key support level. We sold off sharply yesterday, making a spike low of 4246, but ultimately we held in and grinded higher for the rest of the day. Thus this remains a key marker.

My SPI range today: 4250 to 4305. Outlier levels 4289/90 and 4230.

MY SPI day trading plan:
We are indicated at 4276 early and thus right at the top end of the range. I really am not sure how long this uptrend lasts for and I would need to see a climatic reversal out of key resistance levels before I could call it a done deal. The key levels are 4289/90 and then 4300 on the upside. I will look to short fade these levels only if i see a reversal candle on the 5min timeframes. Look for breakout trades above 4300 if we don't sell early. Any dips down to 4250 should be bought once more.

Thursday Plan

Morning All

I am rather torn here in the short term. I see the S&P500 pulling back into a great support zone in the short term. However, certainly there is growing evidence that the market could be on the cusp of a more meaningful pullback. The past few weeks have shown me the importance of following the trend at such junctures and thus I am inclined to look for buy setups in the next 24hrs.

Hopefully these charts illustrate my thinking in the US markets.

S&P500 Cash 15mins:
Breakout and retest of the breakout zone. Our highest probability trade is to buy this with stops below 1350. If we do see a solid break of 1350, I would be inclined to think that 1368 was indeed a more meaningful top. For now, buy this dip.

S&P500 Emini 60mins:
This is my Buy zone in the Eminis at 1350 to 1355. The pullback off the high looks corrective and the high was made on peak momentum. Peak momentum readings imply a retest of that high at a minimum. The target for any rally is 1370 to 1375.

AUD March Futures 60mins:
I also think that the Australian Dollar is at a great support zone here. Any bounce and break of that downward trendline should buoy risk markets. We have a perfect A=C off the top and a failed breakdown through support yesterday.

However, this is what is making me torn. Clearly we are in the final throws or sub divisions of this trend as we approach the May high of 1370. Breadth and volume continues to deteriorate (although this has not seemed to matter so far in this engineered bull market). The Dow Industrial has made a new high above the previous May highs whereas the Dow Transports looks to have topped out well short of its May highs. This is a bearish non-confirmation although not a sell signal in itself.  Furthermore, sentiment readings are no doubt at extremes. Thus, these buy setups I show here are for short term swings only.

It does seem to me we are in the final waves of this move higher as per my count below:

S&P500 Cash 60mins:

DOW Indutrial 60mins:
None of these wedges have worked in the US of late. However, once again we see a clear ending wedge pattern/3 Indians just as the DOW clips the 13,000 level. Will this setup lead to a sell off? Just need the confirmation.

So in sum, I am looking to BUY 1350/1355 in the Emini S&P500 looking for a swing back up to the previous highs at 1370. Any strong move below 1350 would be bearish to me.

My setups and trade ideas in Australia have worked very well the last few days. My SPI ranges have been on the money and just following that trend on the lower timeframes has paid dividends. We have hit my targets in the SPI and the cash market made a high yesterday just shy of 4310. Thus we are now at the top end of the range but the short term trend is still up. Also note that we have seen strong momentum and thus my highest probability trade is to buy the first pullback into the trend.

SPI 60mins:
Hit the top end of the range and target. However, we have seen strong momentum and thus I am looking to buy the first meaningful pullback. Obviously if we clear this 4285/4290 level, that would open up a potential bullish breakout.

My SPI range: 4270 to 4295. Outlier levels 4230 and 4300.

My SPI day trading plan: Will the political situation in Australia have an impact today? I do think that any potential challenge or overthrow of Labor leadership will be taken as a major positive by the market. However, I am probably getting way ahead of myself here. However, markets do like to think ahead and discount the future. We are indicated at 4260 this morning given the overnight session. Once again 4250 provided great support yesterday and was the low. I will buy this level straight up once again today if we get the chance. Please see the chart below. On the upside 4290/93 are potential short fade levels and 4300. Ultimately we will be stuck within yesterdays range but I have a bullish bias given the trend. Only a break below 4250 would open up more meaningful short trades for me.

SPI 5mins:
4250 continues to be great support. Keep buying it until it drops.

Thanks
Austin

Wednesday Plan

Morning All,

Despite all the euphoria surrounding the Greek bailout package, the reaction from the US post their holiday break was subdued indeed. The market tried to push high but grinded lower for the rest of the day with a small pop into the close. Volume was anaemic. The cash market made a high of 1368 which is just short of that 1370 May high. Interestingly, AUD trended lower for most of the day and there are major divergences going on there vs US equities. However, it does look to me like we will still see a push higher in the short term in the S&P500.

Emini S&P 500 60mins:
This is the megaphone type pattern I have been showing of late. We saw a clear spillover at the top end that has resulted in a 10 handle pullback. However, momentum made a new high, the move off the top looks overlapping and corrective, and we are testing previous supports. Thus I think the most probable trade is for the market to hold in here with a swing back up to 1370. Up there ill be on watch for somekind of reversal pattern.

S&P500 Cash 15mins:
I'm not sure if these wave counts are correct. My main point is that we have seen a clear breakout from consolidation and are trending higher. Our highest probability trade is to buy the first pullback to that breakout zone. We are there or thereabouts. Only if this fails can we deem this move off the recent high as more meaningful.

To Australia. Yesterdays SPI day trading plan played out very well. We saw a strong trend day that took us up to the previous highs and target of 4280 where the market made a short term high. I stressed the importance of following the intraday trend and paying heed to the previous days strength.

SPI 60mins:
We hit the 4280 target yesterday

XJO Cash 60mins
However, the cash market did not challenge the previous highs. The more likely trade is that we get there before a more meaningful top/pullback.

My SPI range: 4250 to 4300. Outlier levels 4230 and 4220.

My SPI day trading plan. We are indicated at 4255 early. Yesterday 4250 provided a major inflection point. I believe this should offer good support early. Thus, I will be looking to buy this level with tight stops, looking for a run back up to 4280 and possibly beyond. Note yesterdays low of 4230 is also a good long scalping area if 50s do not hold. On the upside, I will be looking to short fade 4280 but this is for a scalp only. Given that the cash market did not hit its previous highs, I think we may still see a push higher which could take the SPI to as high as 4300.

p.s. the Hang Seng is the one market I have been watching with real interest. The market nailed that resistance zone and sold off. When I drop down to a 5min timeframe, I clearly see an impulsive move lower and a corrective rally. This implies more weakness ahead. This may have an influence on Australia but as ever, trade the underlying.

Hang Seng Cash 5mins:

Bullish Reversal?

Morning All,

Well yesterday the SPI futures exploded out of the blocks and blew away all resistance points cited here. All this within 5minutes and before the cash market had even opened!  Its not often you see that. Obviously there were many traders out there, like me, who were looking to to short the 4200 level and quickly got swept. As ever, keeping your risk and your stops tight is paramount.

Yesterdays rally certainly refutes much of what I said yesterday in the XJO. I talked about that 4250 level in XJO being a key marker and it seems we will pop through this today. Its been a choppy, volatile ride of late and following the intraday trend really has been the only thing that has paid.

So where does that leave us? I will just show you a few charts I am looking at rather than try and make any forecasts at this point. We have a Eurozone meeting going on and really any headlines can pop out of that (although no doubt they will ensure any headlines have a very positive spin to them).

XJO Daily:
The high of my bearish reversal candle is about to be taken out. We are still trading at the top end of the range however. Looks like that upward sloping trendline held in.

XJO Cash 60mins:
Looks like a clear failed breakdown through that support zone. Time to cut and reverse? The overlapping nature of the move lower implies that we could very well have an ABC move off the top and thus this is a new impulse or trend higher with the first target right back at the previous highs.

SPI March 15mins:
A very strong opening candle yesterday and it always pays to follow this momentum. We are now approaching a solid res zone at 4255/4260 which could act as a first stopping point. However, the trend has certainly flipped to up once more and it looks like a clear impulse off the recent low after yesterday. Thus, looking for buy setups/pullbacks into the trend is the play I believe.

As you can see, it all looks quite positive here but certainly we have no new highs in place and are nearing the top end of the range. Furthermore, the S&P500 Eminis are nearly right at their May highs and the Hang Seng had a major reversal yesterday right at my sell zone. Thus this could/should keep a lid on our market in the bigger picture. Not sure. Just have to follow what is at the moment.


Hang Seng Daily:
I showed this chart several times. Yesterday we saw a perfect reversal right out of the res zone. Finally nailed one of these bearish setups! This is the 61.8 Fibonacci retrace off the top and A=C projection off the low.

Hang Seng 15mins:

My SPI range today: 4220 to 4260. Outlier levels 4200 and 4280.

My SPI day trading plan: Given the US public holiday, we have no clear overnight lead. European markets merely played catch up with the dramatic opening yesterday. Im sure everyone will be transfixed on headlines coming out of Europe and that will be the catalyst either way.

The short term trend has certainly flipped back to up. Thus I will be looking for levels and buy setups to get into this trend. The first obvious area of support comes in at 4235/4240 and then down at 4218/4220. I will look for long trades in these zones. Any selling should be capped at the 4200 level given yesterdays momentum. A move below there would be very bearish indeed. On the upside, I will look to short fade that 4255/4260 res zone but only for a scalp trade. If we fail to sell there, look for consolidation patterns/breakout setups to join a push to the previous highs at 4280.

Thanks
Austin