A relatively narrow range made for tough intraday trading on the index contracts yesterday. A good example of why I like to wait for a breakout and pullback to confirm that the breakout will last! Of course that’s one approach; very short term traders were probably content with the scalping action, and for the most part we’ve seen resistance breaks indicating that more upside should be in store for those holding longer term. So I think we have to think of yesterday as consolidation in the middle of longer term moves. What’s most important in considering this is that all 45 minute support is holding at this point, and based on this morning’s early trading we should establish additional 45 minute support at the open. Minor timing highs next week relate to the current daily target extensions, so there’s no immediate timing unless we see new daily swing highs in any case. While the info isn’t on the charts at the moment, I’m leaning towards October 23rd – 26th as a more significant timing resistance zone. I’d like to refine these calculations a bit so we’ll examine it more closely over the weekend. Meanwhile a break of the .786 res levels visible on daily and 45 minute charts is key.
S&P cash daily, initial daily target 1096 if it can break 1067:
ES 45 minute, 1092 initial target if it can break above 1063:
Dow cash daily, initial target 10050 with a break above 9813:
YM 45 minute, initial target 9999 with a break above 9746:
Mark Braun-Market Geometry