Back and forth we go….The bulls and the bears continue to battle it out for control of this trade. Overnight the Nasdaq futures came within 1.25 of unchanged for the year and then rallied 30.00. I think that the bulls are protecting unchanged for the year in the Nasdaq. As long as the Nasdaq can sustain…… trade in positive territory for the year I think that the rest of the market will take that as a positive and try to rally into the end of the year. The Dow is trading comfortably in positive territory for the year and is currently in a tight trading range between their 50 day and 200 day moving average. Whichever side that they can break out from could be a good lead for direction. The Transports recently held a test of their 150 day smooth and 50 day moving averages. That is bullish action and as long as they can sustain trade above that area I think that we could see the Indices start to grind back up. The S&P cash continues to sustain trade below all of their major moving averages and that is bearish action. If the cash continues to fail to get back above their 150 day smooth and 50 day moving averages I think that we see another selloff in the S&P. There is divergence between all of the major markets and I expect the trade to remain choppy until either the bulls or the bears start to take control of this market. Today I will be initially looking to sell rallies up to the 150 day smooth moving average at 1224.11 (futures), resistance at 1226.25, and the 50 day moving average at 1227.03 (futures) and I will be looking for a test of the daily pivot at 1214.25 where I will be a buyer. Failure to sustain trade below that area I will turn buyer and then be looking for a test of resistance above at 1238.00 where I will be a seller. If we cannot sustain trade above the daily pivot I will turn seller and then be looking for us to fill in the Gap and then possibly test support below at 1202.50 where I will be a buyer. Failure to sustain trade above 1202.50 I will turn seller and then be looking for the monthly low to be tested at 1198.00 and then a possible test of support below at 1190.50 where I will be a buyer. Have a great day!

Written by Anthony Crudele

This entry was posted on December 19, 2011 at 7:35 am. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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