Chicagostock Trading

Sometimes most of the move is done in the overnight (Globex) session, and by the time the cash market opens and everyone is selling the weakness, the cash market holds to prevent these traders from getting paid. Interesting? Weird? This is what I call CASH MARKET GAMES.  Not only does a lower open lure in shorts, but when it pushes back to close on the highs, it sucks in new longs that need to get paid in the following session. Should the market open lower in the following session, those new buyers are on the hook and short sellers have to come back chasing lower. 

On Thursday of last week, the market sold down to a low of 240525, which successfully tested and held the June low.  Friday saw the market overcome the 3D pivot range resistance to reverse the negative momentum. This reversal allowed Monday and Tuesday's 3D pivots to turn into support.  Both days saw the market chop sideways into awaiting for Janet Yellen on Wednesday.  This in turn, creating a cup/handle pattern, with room to expand into 2449 on a break through 2427.  

When Trump took hold of Florida on election night, the SP500 futures sold off to a low of 2028, hitting its limit of 100 points to the downside.  The move, was reversed within the same day, seeing the market recover to push back to 2180 once the election was over and Trump was confirmed as the new President-elect.  The election of Trump, caught many off guard, however the market reversal also caught many off guard as a majority was looking for a sell off should Trump have been elected.  By taking the reversal of 2180-2030 of 150 points, this gave an upside objective of 2330.

Anyone old enough to remember the euphoric action on May 2, 2012 when Bin-Laden captured? $ES_F $SPY $SPX pic.twitter.com/8xMCd1AWzO

— Chicagostock (@Chicagostock) March 2, 2017

https://twitter.com/Chicagostock/status/837413741125828608

On March 1st, the SP500 gapped higher with an open at 238150.  This forced shorts to cover and buyers to chase prices above 2380.  The market rallied into a high of 2401, before it was retraced back the following day on Thursday. By retracing the move back, the market created an inverted cup/handle leaving buyers that chased the market above 2380 on the hook to see a shakeout down to 2361.  

Before Mr. Ben Bernanke became Fed chairman, he made a speech before the national Economists Club in Washington, DC. on November 21, 2002, titled “Deflation: Making Sure "It" Doesn't Happen Here.” In these remarks, there were 5 major points Mr. Bernanke pointed out as tools the Fed could use to fight deflation: