Morning Update: 2/3/2012

7:48 am….

The stock market indices had a very mixed session at the close, although the technicals were positive at the end of the day. The day started out much better, with a gap up, a 5-wave advance that took them to new highs for the rally, the NQ reaching over 2500 to 2502, and the ES reaching up to 1326. But the ES did not get near the 1328.50 level that it reached yesterday, and that resulted in a very sharp slide to retest the lows on the NQ. That was successful, despite the fact that the ES made lower lows by midday. They then stair-stepped their way higher in an orderly fashion, only to back off in the last 15 minutes to end mixed on the day.

I had three trades yesterday… 6E, ES, 6C

6E-  Initiative balance extreme closed for a nice profit.

ES- Closed for a small profit balance extreme responsive in nature

6C- balance extreme responsive in nature closed for a small gain

News for today… 07:00 Canada Jan Unemployment Rate/Net Change in Employment; Full Time and Part Time Employment Change07:00 Canada Jan Participation Rate08:30 US Revisions: Establishment Employment Survey Annual Revisions08:30 US Jan Change in Non-Farm/Private/Manufacturing Payrolls08:30 US Jan Unemployment Rate08:30 US Jan Average Hourly Earnings/Weekly Hours08:30 US Jan Change in Household Survey Employment08:30 US Jan Underemployment Rate (U6)09:00 Mexico Jan Consumer Confidence10:00 US Jan ISM Non-Manufacturing Composite10:00 US Dec Factory OrdersTBD Brazil Dec CNI Capacity Utilization (Release expected 2/3-2/9)

Stepping back and reviewing the hourly chart patterns, the indices were up sharply in the morning, down sharply by midday, and rallied back to take back all the losses on the NQ and ES and move them to the plus column, but not so on the YM. They closed mixed on the session, with positive technicals. We’ll see if today was more than a consolidation, or perhaps a topping pattern very shortly.

Olof Thomas

 

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