Wait and watch. That is where your tape reading comes in, to enable you to decide as to the proper beginning.
- Larry Livingston, Reminiscences of a Stock Operator
Unless, you were hiding out in a cave somewhere with Osama Bin Laden watching endless re-runs of President Obama's Oval office adress you probably noticed the huge rally in equity markets yesterday. Many analysts, economists, traders, and journalists attributed the rally to 'robust' PMI data from The People's Republic of China, Europe, and The U.S. Though, ADP employment showed glaring mediocrity in job growth leading up to Non-Farm Payrolls on Friday. Regardless of trailing economic data, the tape tells the true story as always.
3 Month Daily E-Mini September SPX Chart
3 Year Daily SPX Chart
Conclusion:
1100 is the key price level I'm looking for. If the candles trade above this line I expect a retest of 1130 and maybe a break out to 1150. This must happen in Tomorrow's session though. I fear awful Non-Farm Payroll numbers will allow the shorts to plunge the equity markets once again. The RSI will move up and re-test 60, if it fails to do this, I expect heavier selling-pressure to result. As of writing time, 12:00 EST, Nikkei is up 32.27 points @ 895.29 down significantly from the open. Make it a good trading day.
Patrick M. Ambrus
Analyze Capital LLC
Twitter: AnalyzeCapita
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