We will start off with an update of the overseas market.
The Dow closed up +20 points or 0.15%
The S&P500 closed down -2 points or 0.16%
The Nasdaq closed down -10 points of 0.31%
The market reacted negatively to the unemployment claims data which rose slightly higher. The Dow closed slightly positive while the S&P and Nasdaq closed slightly down. At one point during the night, the S&P was down more than 10 points! Then it slowly recovered from that point and are back trading within yesterday afternoon's range. Whew!
Also, take note that we will have no significant economic data tonight that will effect the market in a big way.
For the S&P contract, we have actually touched the lower range of our weekly forecast range and in the Daily, have actually touched the 20ema line and rebounded from there. So is the pullback done? Is the market ready for the ride up its momentum again? Well, it remains to be seen. We will follow the price action closely and trade acordingly.
How will this affect us:
FKLI
Alright.. In the daily chart, the bar yesterday actually traded just outside the lower trend line. Now, when prices trade outside the trend line, it doesn't automatically mean that the trend has been broken. For example, after a strong rally or sharp sell off, price tend to consolidate and during such consolidation, price trading outside of the trend line is quite common.
However, even though we suspect that this break is not of too much significant, it does signify that the buyers are slightly weakening and are not able to defend the levels as well to prevent the break of the trend line. We will need to be watchful for signs of further development in the coming weeks for trend changes.
As for today, with the US market rebounding off the support with sufficient energy to reduce the deficit, I am slightly encouraged by that and combined with the fact that there are no significant economic data which might keep traders out of the market. But please bear in mind that today is a Friday and many traders don't like to hold position into the weekend so will lighten their position accordingly.
I expect a slightly choppy range trading day to a slightly upside biased day.
Below are the Support and Resistance levels from the charts:
Cash Index:
Upper Resistance: 1588 and 1591
Lower Support: 1582, 1580 and 1578
April Contract:
Upper Resistance: 1588 and 1591
Lower Support: 1580, 1578 and 1574
Alright, trade safe and all the best!
Best Regards,
Tech Trader
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