Sep03.pdf

Trading plan for September 3, 2010

After ES made a small pullback during overnight trading, it moved back and forth to slowly march up to squeeze the shorts. At the end, the bulls won again yesterday.

Now the price has moved above the 50-day moving average line (1078.25), which will act the first major support line, and encourage the bulls to stay in their positions. Thursday’s price movement confirms our analysis yesterday: the short term low has been posted.

Even thought about 50% of the volume was missing, the price behavior still was bullish. Price could make an internal correction to smooth out the short timeframe overbought condition and keep pushing up with light volume. This uptrend could last until next week if today ES continues ignoring suspicious economic reports (employment data) in the early morning.

1093.75-1095.50 is the key range for today. A move above it will be bullish and odds will favor a push higher. Holding under this key range is likely to move ES down to retest 1075-73 or lower to 1067.50-69 range, especially if the unemployment is much worse than the street expects.

Date Added: 2010-09-02 17:56:44
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