James´ Insight

Today´s Outlook

• S&P 500 e-minis: bullish above 1137, bearish below 1137
• Current reading is 197 which is bullish, but declining

Weekly Outlook

If we see a red daily candle on Monday, the break point is 1136. If we see red on Monday the market is putting in a bigger top than I initially thought.

There is a major trend line over head at 1155 on the SP500. Add the data up: Dow breaks upwards on Friday and we are nearing the break for the SP500 as we enter a Jewish holiday week. That may mean very weak price action this week as price consolidates along the Dow trend line as it prepares for a break upwards.

Analysis

As mentioned before, today should see a “walk away trade” at end of quarter. Up in morning and then a sell off that should initiate a down leg.

The down leg should bottom around mid October and then price should RUN higher into a November top. After that all bets are off.

This entire week has been a Jewish Holiday, in fact, three holidays and the volume reflects that.

Good luck with your trading!

James´ Insight

Today´s Outlook

• S&P 500 e-minis: bullish above 1141, bearish below 1141
• Current reading is 222 which is bullish, but far from the momentum we had

Weekly Outlook

If we see a red daily candle on Monday, the break point is 1136. If we see red on Monday the market is putting in a bigger top than I initially thought.

There is a major trend line over head at 1155 on the SP500. Add the data up: Dow breaks upwards on Friday and we are nearing the break for the SP500 as we enter a Jewish holiday week. That may mean very weak price action this week as price consolidates along the Dow trend line as it prepares for a break upwards.

Analysis

Right now the Dow weighted issues a sell and the smaller stock issue a buy, which is the first time I’ve seen that split signal. This is not a good thing!

With that being said the market has some serious overhead at 1153-5 and will require volume to break thru. So far this advance has NOT seen volume, and reasons are now fairly obvious.

On the plus side we have tested 1127.50 twice and seen price hold, with a break of 1153 that SHOULD put us on an upward path finally, a run that funds can’t afford to miss.

We are fighting a breakout on the Dow, the SP and a drop in BID, it is not a convenient spot on the charts.

It should get a bit easier above 1155. The EXTREME chop we’ve seen should ease up.

Good luck with your trading!

James´ Insight

Today´s Outlook

• S&P 500 e-minis: bullish above 1141, bearish below 1141
• Current reading is 209 which is bullish, but far from the momentum we had

Weekly Outlook

If we see a red daily candle on Monday, the break point is 1136. If we see red on Monday the market is putting in a bigger top than I initially thought.

There is a major trend line over head at 1155 on the SP500. Add the data up: Dow breaks upwards on Friday and we are nearing the break for the SP500 as we enter a Jewish holiday week. That may mean very weak price action this week as price consolidates along the Dow trend line as it prepares for a break upwards.

Analysis

Yesterday: As announced in yesterdays Newsleak we saw a very choppy sideways market which left little to trade on.

For today: The market is acting bearish but price is going into quarter end. Normally we see some window dressing. However I believe we might see a “walk away trade” on Thursday (up in the morning and then down as investors “walk away”). Funds want the rally but they’ll spend their bullets in the new quarter to get it and it wouldn’t surprise me to see a sell off first, to assure a low price.

So three days of chop and then Thursday. The entire week is also a Jewish holiday…low volume. Yesterday not only saw extremely low cash volume but also half the number of contracts on the emini as normal. Take it one day at a time.

Good luck with your trading!

James´ Insight

Today´s Outlook

• S&P 500 e-minis: bullish above 1136, bearish below 1136
• Current reading is 312 which is bullish again, but far from the momentum we had

Weekly Outlook

If we see a red daily candle on Monday, the break point is 1136. If we see red on Monday the market is putting in a bigger top than I initially thought.

There is a major trend line over head at 1155 on the SP500. Add the data up: Dow breaks upwards on Friday and we are nearing the break for the SP500 as we enter a Jewish holiday week. That may mean very weak price action this week as price consolidates along the Dow trend line as it prepares for a break upwards.

Analysis

The Weekly Outlook says it all for today.

The volatility during September and October is just beginning. November should be very straight up.
After November, all bets are off for this market

Good luck with your trading!

James´ Insight

Today´s Outlook

• S&P 500 e-minis: bullish above 1124, bearish below 1124
• Current reading is 25, lost momentum

Weekly Outlook

Some continuation would be expected to the downside.

Now, we have a couple of mitigating factors here:

1) the boys want a rally to lock in bonus and they need that price over the years open at 1113.75
2) price is sitting on the 200 dma which many institutional people look at
3) the low volume right now indicates an unwillingness to sell
4) the low volume is still higher than the lowest volume recorded (HL)
5) price has formed a LOW with a HIGHER LOW and HIGHER HIGH, this is classic bullish price action
6) in the very short term the DI on the daily gone sideways indicating a possible rollover but the daily BID is still 629 indicating someone is buying everything offered. There are two ways for a corrective move down to occur
a) actually move down or
b) move sideways.

I’m in the sideways camp until such time that price CLOSES below the highest low on the daily. It is not a stretch of the imagination to get a short burst down to the 1105 area. With the FOMC meeting we can easily get a fast burst and then a run right back up.

As slow as it is currently, don’t underestimate what the boys can do at the end of year. Bernanke wants the market up, the boys want it up, we have had an incredible five month reversal pattern form.
There is some severe choppiness indicated on the extremely long term cycle chart into the end of October, November looks like a run for the roses and December I believe “reality” is going to set in.

Analysis

We called for a reversal down and we have a reversal down.

We called for an initial target of 1127 and got it. We called for a LH, LL yesterday and the low was 1120, check.

We are on a continued sell signal, we have lost momentum on the cycle and we are looking for 1105. From 1105 we NEED a decision. I’m looking for a reversal up off 1105.

Now for the ominous yellow flag on the field, the Dow is showing weakness. If the Dow runs back down to 10,000 then that translates to a 70 point drop in the SP500 taking price well below my target of 1100-1105.

Now for the money part, we want that really into years end. Price is only 6 points off the years open of 1113. Most funds are near breakeven for the year and they can’t afford to miss the rally and they know it. The investment of the year has been CASH so the funds are hungry for the rally; even if it lasts only one month and ultimately it will be sold into and the crash of 2011 will unfold.

Good luck with your trading!

James´ Insight

Today´s Outlook

• S&P 500 e-minis: bullish above 1132.25, bearish below 1132.25
• Current reading is 252, lost momentum

Weekly Outlook

Some continuation would be expected to the downside.

Now, we have a couple of mitigating factors here:

1) the boys want a rally to lock in bonus and they need that price over the years open at 1113.75
2) price is sitting on the 200 dma which many institutional people look at
3) the low volume right now indicates an unwillingness to sell
4) the low volume is still higher than the lowest volume recorded (HL)
5) price has formed a LOW with a HIGHER LOW and HIGHER HIGH, this is classic bullish price action
6) in the very short term the DI on the daily gone sideways indicating a possible rollover but the daily BID is still 629 indicating someone is buying everything offered. There are two ways for a corrective move down to occur
a) actually move down or
b) move sideways.

I’m in the sideways camp until such time that price CLOSES below the highest low on the daily. It is not a stretch of the imagination to get a short burst down to the 1105 area. With the FOMC meeting we can easily get a fast burst and then a run right back up.

As slow as it is currently, don’t underestimate what the boys can do at the end of year. Bernanke wants the market up, the boys want it up, we have had an incredible five month reversal pattern form.
There is some severe choppiness indicated on the extremely long term cycle chart into the end of October, November looks like a run for the roses and December I believe “reality” is going to set in.

Analysis

Ok, we have a continuing sell signal but during market hours we hit the top of trend at 1127.50 as mentioned yesterday.

Before going any further we need to talk about volume. Volume continues to be very, very light. Why?
My very simple answer is there is no cash available to be put to work.

So how does a market continue to go up? You have very thin volume and fewer sellers than buyers. The banks have also closed their prop desks taking billions out of the market. Liquidity is certainly down. (Doesn’t affect us in the emini but it is affecting the rest of the market).

Or, as everyone is predicting, you get a major sell off.

In my experience you do not get the sell off that easily. You do not get the sell off until every buyer is in and you don’t get it until the boys run it up to kill it. Some things never change.

I am in agreement with the general theme that a MAJOR down move is about to start. It is a matter of timing. Fortunately that is part of what we investigated and have firm control over.

Bottom line: Watch 1132.25 as a strong resistance for any upside movement. Keep in mind that 1127.50 is trend and the pullback has the potential of 1100-1105.

Good luck with your trading!