Tuesday, October 25, 2011

Tonight's 4 hour S&P500 Chart (SPY)

4 hour ES
Over 1250 we go to 1300.. if we fail, we could see a test of 1300, followed by 1190.. Granted a new channel of 1300/1200 will be formed if 1300 is met. What is moving us higher is still short covering and buy programs pushing index markets up into buy stop areas. there is still not much average retail interest as you can see by the volume histogram at the bottom of the page. Todays volume was very low.

Are we reaching a point of exhaustion, or will a new group of shorts get run over into the the 1300 level? either case could play out. be prepared for either scenario. it is obviously the 1100 level is a level which see's huge volume when it is toyed with which makes this rally somewhat believable because of the amount of volume which was triggered at this level. Will there be enough good news to keep the ES over the 1300/1400 level ? will the next phase of QE take us into record high territory as inflation really takes hold? this could be the case if the fed gets their way and europe sweeps itself into 60's levels of economic growth. All bets are off.
ES 5 min.. Lowest volume in WEEKS.

If you think i am shorting this market every day all day you are wrong. all sell signals have been false thus far. There is a form of QE going on behind the curtain beyond operation twist, though we as a group of market participants have not yet been informed.

Think stabilizing bids and increased overnight volatility with regular session prices usually only circling around the overnight prices.