Special thanks to today's Guest Post from Mohan. Mohan has been a frequent contributor of the TradingPub and recently hosted a webinar session to our patrons that was very well received. During this session, Mohan covered, "How to Read the Markets Like a Book." We were able to capture a recording of this session and have posted it along with a recap under the "Education" tab on our website!
We hope that you enjoy his directional forecast report!
Directional Forecast: Neutral. Watch for a lower, early move that catches support and makes a weak rebound off the early lows. Recap of Friday's Action:
Good morning and welcome to Monday's trading action.
We had the Option Expiration on Friday and I do not make Directional Forecasts on these sessions as per our long standing tradition.
I did however make a supplementary call for lower prices which we have been talking about after the jump to 1374 on Thursday where we shorted.
Right now we are in the Neutral area on the Market Force Indicators.
Normally after a nice reversal like we saw on Friday's expiration we will see the market head lower early and then reverse to try to "neutralize" the stronger move lower.
More on this below....
Today's Call & Briefing:
Watch for early, lower prices after an expected gap lower opening.
Right now as I type prices are trading at the 1346 area and this represents a 12 handle gap lower open if they hang down at this level.
If so watch for an early panic and the supportive move coming in probably during the first hour of trading (Hour One).
1339.50 is Key Support for the early trading action.
Moving under that can cause a mini crash early in the session however odds favor support coming in.
If they blow through 1339 then we have to watch 1331.50 to hold up the market. Otherwise, there is something wrong here and perhaps the negative European market situation is going to cause another stronger market selloff.
So watch for the early support probably accompanied with strong volume spikes on any early, lower moves and then gradual stabilization and rebound.
Keep an eye on how the financial news is playing out and see if there are any prominent negatives being touted as significant. No major Government reports are scheduled today.
Value Area: 1,358.30 - 1,362.20
Trade holding under 1353 can continue lower. Moving to 1353 and stalling is a Neutralizing move and may produce a more range bound type session today.
Buy Pivot Target: 1,355.00 - 1,356.00
Prices have already pulled back substantially on Globex under this level.
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