These Markets, Including The Stock Index Futures, Could Heat Up Quickly

Good evening everyone! Ryan here bringing you tonight’s free video. A warm welcome to any new students that may be joining us for the first time that may have participated in the live event with Rob and Infinity Futures this morning. Of course, welcome and good evening to those of you that have are already students and have been with us all along. I am going to look a number of different markets here because there are quite a few things going on. As you guys can imagine, one of my focuses here is going to be the stock index futures.

A Review Of The Stock Index Futures

The stock index futures have been put into a very precarious position, from my point of view. What we have here is in the S&P we have speed lines coming down on top of us as resistance. We have some key levels here just underneath of us that the market just doesn’t want to close below. In fact, today we put in an inventory retracement bar here where we saw accumulation in the market in the S&P, the DOW, the NASDAQ, and the RUSSELL.

A lot of indecision here. A couple of people potentially looking for some bargains but buying large we have a lot of downward pressure still. What this means is with the resistance coming down on top of us and these inventory retracements underneath us in virtually all of the markets here is that the market has to make a decision one way or the other. It is really kind of coiling up in its own little small sense as far as indecision goes. It is in need of a breakout in one direction or the other. Which direction? I don’t know specifically so I am going to stay nimble here. My preference, in this case, would be for it to break to the downside because we have these markets really holding onto very precarious positions.

In the NASDAQ at right about 3850 you can see these last levels of support here. If these levels were to be broken it would open up a lot of downside potential here. Same thing in the other markets if we can get the DOW below this round level here at 16300 and the inventory retracement it made there as well. There is additional room to go to the downside. If we don’t find this support or we don’t find that buyers are buying then it is very possible that the break could have another swift leg down. It could possibly be proportionate to what happened on the front side of this little consolidation. In any of these markets that would be possible.

Of course, you look at this market and one naturally wants to think “it’s a bit oversold here so we are due for a correction”. You know, I couldn’t necessarily argue with that. Getting back up into some of these key levels where there is price support and some additional falling resistance on top of us here would not really change the overall bearish view right away. In fact, it would just give us a little bit more of a breather and consolidation to which we might be able to continue to the downside. That is very possible. That is what I am going to be looking for. Again, if this turns into sellers don’t sell then we could see violent snaps to the upside. That is one of the things that leads me to believe that the market is in a very precarious position.

From the stock index futures point of view what I will be doing is, again, looking for the weakest market. In recent days and weeks the NASDAQ was the strongest and I’ve noticed it has also been the weakest here a number of times on an intraday basis. That 3850ish level is what we want to break through to see the potential to the downside. I’ll be monitoring how the markets are moving and how they are changing on a net percentage basis, how they are moving intraday volatility-wise (especially if it does open up to the downside) so I can see which one is the weakest and focus on that market.

Other Markets Poised For Action

I’ll run through a couple of other markets as well and offer up my opinion and what I am seeing.

Here in the Gold market I don’t have any interest in trading this until it does one of two things:

1. If it were to get back down below this 1280 level. If we were to see this come all the way back down to the 1280 level and break to the downside below the momentum shift breakout bar then I would be interested in short side trades.

2. On the topside I am not particularly interested until we can get through the band of resistance that comes in right about the 1350-1320 levels. You can see there has been a lot of activity right in this range where we’ve seen inventory retracement, accumulation, distribution, and a lot of price activity. Until it really clears the 1320 level then I am not interested in Gold to the upside. If it were to, in fact, break this level then I will absolutely keep an eye on it to see if there is further upside potential in the Gold market.

As it sits right now you can see that more or less we are turning into a mess here. This is just turning into a sideways market that doesn’t really have strong direction either way.

In Crude Oil, I would like to see this follow through. I would like to see a wash to the downside, just maybe one more capitulation type selling as we break this last level of support. This level of support that was put in with inventory retracement bars that was made back here with accumulation is really the last stronghold of support before we might see some type of wash out activity or at least some continued downside (with hopefully some conviction) in the Crude Oil market.

It is at this point where, if it does find support and can get back above the speed lines, that a healthy bounce would be perfectly normal. It is showing some signs of weakness though so I would like to see some downside activity there. I will be monitoring this market to see if it can pick up some steam to the downside.

In the Bond market Rob had been warning all of us about this 139.09 level. It more or less hit it to a tee before again creating another inventory retracement bar. It found some distribution and came right off of that level. The challenge here in the Bonds is to work back through that level and work back up through 139.09 and then potentially open the door to much higher maybe into the 140 level. For right now the Bond market moving higher is facing this big band of resistance and that is going to be the major challenge for this market. I will see if it does, in fact, get back up to this 139.09 and how it responds. I would like to see it break, test and go. That is proving to be somewhat formidable resistance at this point. We have an uptrend underneath us though so we will see what happens in the Bonds moving into the rest of this week. Until then, I am not particularly interested in the Bond market yet.

These are a couple of the markets that I will be looking at in the coming days and potentially weeks depending on how they shake out. I hope that helps you guys out and I will look forward to seeing you in the Live Trading Room tomorrow morning or in the nightly videos tomorrow night! Have a great evening.

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