Morning Update for Friday, April 11th

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment: Bearish
Overnight Inventory Change: Net short
Inside Day/Outside Day:Outside
Location of price relative to market profile: Below value area
Notable overnight futures markets changes:
Up: OJ (Orange Juice)
Down:ZO (Oats), NKD (Nikkei), ZL (Soybean Oil), SB (Sugar), ZS (Soybeans), NQ (Nasdaq)



News for the day:

PPI-FD: 8:30a
Consumer Sentiment: 9:55a

*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day: The bears are starting to come out of hibernation on all of the indexes, especially the Nasdaq.  The market makers lured in buyers after Wednesday's Fed news in lifting the offers and making the market appear to be strong, only to dump the contracts/shares in a big way yesterday.  Not only did the ES trade below the high volume node of 1830, it also closed below the 50 day MA for the first time in two months.  It is necessary to keep the location of prices in mind and the overall context in which the market is trading.  We are still in a long term uptrend but velocity is beginning to pick up to the downside.  The 50 DMA @ 1838 and the pivot levels will be significant to watch for today as intraday traders will be looking to buy/short at these points.  Intraday edge is bearish.

Stock of the Day: Nasdaq-100 ETF (QQQ)- Index down 3%+ yesterday

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish 

Morning Update for Thursday, April 10th

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment: Bullish
Overnight Inventory Change:Net short
Inside Day/Outside Day:Inside
Location of price relative to market profile: At value area high
Notable overnight futures markets changes:
Up: SI (Silver), KC (Coffee), PL (Platinum), GC (Gold), PA (Palladium), ZO (Oats), SB (Sugar)
Down:NKD (Nikkei), CC (Cocoa), ZL (Soybean Oil), NG (Nat Gas)



News for the day:

Jobless Claims: 8:30a
Import and Export Prices: 8:30a
Treasury Budget: 2:00p

*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day: When it comes to the markets, the phrase that comes to mind is "expect the unexpected." Just as the bears started to gain some momentum for the past week in selling contracts through the high volume node on the composite profile, the bulls swooped in and bought the dip after the positive Fed news yesterday of near 0 interest rates for the foreseeable future.  The importance of key swing levels on the charts cannot be understated in identifying locations on the chart for potential inflection points. The 1832 price level had been an area of support which saw three tests of the range and each time the bulls lifted the offers. It held once again and the S&P is trading in the middle of the high volume node from 1830-1880. The higher probability is for continued two-way trading and the most advisable strategy would be smaller profit targets and the use of stop loss orders to limit risk.  Intraday edge is neutral/bullish.

Stock of the Day: Bed Bath and Beyond (BBBY)- Earnings reported after the bell last night

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish 

Morning Update for Wednesday, April 9th

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment: Bullish
Overnight Inventory Change: Net long
Inside Day/Outside Day: Inside
Location of price relative to market profile: Above value area
Notable overnight futures markets changes:
Up: ZS (Soybeans), ZL (Soybean Oil), ZW (Wheat), NG (Nat Gas), ZM (Soybean Meal)
Down:KC (Coffee), SI (Silver), ZO (Oats), HG (Copper)



News for the day:

Petroleum Status Report: 10:30a
FOMC Minutes: 2:00p

*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day: The two strongest emotions that an investor feels is fear and greed.  For the majority of 2013 and 2014, the large institutions and hedge funds have been absorbing the low interest rates set by the Fed and have driven the S&P to all-time highs.  At the same time, when the selloff does occur, the higher probability is for the market to give back the profits quicker on the way down than on the way up as they look to preserve as much capital as possible.  Given the wide range red candles the past couple of days and above average volume the velocity for the bearish case is starting to accelerate.  FOMC minutes are set to be announced at 2pm today and it is setting up to be a pivotal event. If the news is less than what the street is expecting than the liquidation could continue as the sellers look to build momentum.  The key level remains the high volume node from 1830-1835.  The ES is currently trading above it in the premarket and the level should be on alert when the market opens for business.  Intraday edge is neutral/bullish.

Stock of the Day: Alcoa, Inc. (AA)- Earnings reported after the bell last night

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish 

Morning Update for Tuesday, April 8th

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment: Bearish
Overnight Inventory Change:Neutral
Inside Day/Outside Day:Inside
Location of price relative to market profile: Near value area low
Notable overnight futures markets changes:
Up: ZO (Oats), KC (Coffee), PA (Palladium), GC (Gold), SI (Silver), CT (Cotton), 6N (New Zealand Dollar), PL (Platinum), 6A (Aussie Dollar), CL (Crude Oil), 6B (British Pound), 6J (Yen)
Down: NKD (Nikkei), ZW (Wheat), ZL (Soybean Oil)



News for the day:

NONE


*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day: Like the NCAA basketball championship last night, the market has both winners and losers.  The late buyers to the bull run who entered positions after Friday's jobs report has especially felt the selloff the past couple of days.  The liquidation continued yesterday as the bears were at it once again. We are at a pivotal area of the chart on the ES given the fact that there is a triple bottom at 1832.25, the key level to watch for the day. Not coincidentally, there was a bounce yesterday at the high volume node on the composite profile at 1838, which also happened to be the point of control (POC) for the day.  If prices can clear the 1832 area then the higher probability is for continued selling, especially since the trend would set up for trading below Monday's range. Intraday edge is neutral/bearish.

Stock of the Day: Questcor Pharmaceuticals, Inc. (QCOR)- Up 18% yesterday

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish 

Morning Update for Monday, April 7th

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment: Bearish
Overnight Inventory Change:Net short
Inside Day/Outside Day:Outside
Location of price relative to market profile: Below value area
Notable overnight futures markets changes:
Up: KC (Coffee), NG (Nat Gas), ZO (Oats), ZW (Wheat)
Down: SB (Sugar), PL (Platinum), NQ (Nasdaq), PA (Palladium), CL (Crude Oil)



News for the day:

NONE

*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day: The jobs report on Friday brought back added volatility to the markets, the likes of which we haven't seen in weeks.  It is important to remember that the indexes don't crash up, they crash down.  After a significant rise dating back to 2013, the bears are licking their chops to build some momentum.  Selloffs typically occur after major news events and Friday may be the beginning of the correction, however no one knows when or the significance of the pullback.  The charts tell us everything about the price action to make the trading decisions.  Based on the premarket activity, prices on the ES have sold below Friday's range, a bearish sign.  The open will be noteworthy to see if there is any profit taking to lift the offers back up to Friday's low of 1855.75, which is the key level to watch for today. If the liquidation continues, there is a high volume node at 1840 and would be a natural target for the bulls to step in for a bounce. At this point, intraday edge to the bears.

Stock of the Day: Google, Inc. (GOOGL)- Bearish cloud break with large volume

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish 

Cloud Trader Weekend Update 4.6.14

Morning Update for Friday, April 4th

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment: Neutral
Overnight Inventory Change:Net long
Inside Day/Outside Day:Inside
Location of price relative to market profile: Above value area
Notable overnight futures markets changes:
Up: ZL (Soybean Oil), KC (Coffee), CL (Crude Oil), HG (Copper), SI (Silver), GC (Gold), ZS (Soybeans)
Down:NG (Nat Gas), ZW (Wheat)



News for the day:

Employment Situation: 8:30a

*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day: Today marks an important day in the markets with the S&P at all-time highs and the monthly jobs report set to be announced at 8:30a.  The combination of technical traders who do business at the breakout of the highs combined with the fundamental traders who enter positions based on macroeconomic news events will bring in added volatility to the markets and provide the potential for more intraday opportunities.  The ES has seen more buyers during the premarket and the offers have been lifted near the high of 1887, which will be the level to watch for today.  Intraday edge is bullish, but all hinges on the market reaction to the jobs report numbers.

Stock of the Day: Pandora, Inc. (P)- Bearish bounce from the cloud bottom

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish 

Morning Update for Thursday, April 3rd

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment: Bullish
Overnight Inventory Change:
Inside Day/Outside Day:Inside
Location of price relative to market profile: At value area high
Notable overnight futures markets changes:
Up: ZL (Soybean Oil), ZC (Corn), ZS (Soybeans), ZM (Soybean Meal)
Down:NG (Nat Gas), SI (Silver), HG (Copper)



News for the day:

International Trade: 8:30a
Jobless Claims: 8:30a
ISM Non-Mfg Index: 10:00a

*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day: And just like that, the S&P is back to the all-time highs. It is a reminder of one of the most important rules of trading: never fight the Fed.  With interest rates near 0% to spark the economy, large banks and hedge funds continue to buy up the contracts in droves.  Ever since the bears attempted to sell the ES through the high volume range on 3/27, there has been 5 consecutive days of higher value areas, creating 4 new VPOCs below, a sign that the bulls have been aggressive in buying any dips.  Tomorrow is the monthly jobs report number and it increases the likelihood of intraday volatility as macro traders position themselves for tomorrow.  The key level for today is the all-time high of 1886.25.  Intraday bias is bullish.

Stock of the Day: Yelp (YELP)- Bearish cloud breakout

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish 

Morning Update for Wednesday, April 2nd

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment: Bullish
Overnight Inventory Change:Net long
Inside Day/Outside Day:Outside
Location of price relative to market profile: Above value area
Notable overnight futures markets changes:
Up: ZL (Soybean Oil), ZO (Oats), SI (Silver), NKD (Nikkei), HG (Copper)
Down: KC (Coffee), ZW (Wheat), 6N (New Zealand Dollar), NG (Nat Gas), HO (Heating Oil), SB (Sugar)



News for the day:

ADP Employment Report: 8:15a
Factory Orders: 10:00a
Petroleum Status Report: 10:30a

*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day: There is a new movie coming up entitled "Divergent" which is a science fiction story about groups of people who are categorized based on a given personality trait. A divergent is one who possesses multiple traits and can sorted into multiple groups.  The same could be said for the S&P yesterday as the SPX cash index made an all-time high but both the ES future and the SPY ETF still were a few points below the level.  Typically the 3 indexes move in tandem and when there is such a divergence it will be noteworthy at the open to see if there is a liquidation break.  Tuesday's high of 1878.75 will be key as prices have been trading near the highs during the premarket.  The other main level to watch is the breakout point on the composite volume profile at 1875 for confirmation of the continued buying activity. Intraday edge is with the bulls.

Stock of the Day: Apollo Group Inc. (APOL)- Bullish cloud break and tenkan/kijun cross

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish 

Morning Update for Tuesday, April 1st

Major Support/Resistance Levels- ES

Daily Outlook

Prior Day Market Sentiment: Bullish
Overnight Inventory Change:Net long
Inside Day/Outside Day:Inside
Location of price relative to market profile: Near value area high
Notable overnight futures markets changes:
Up: ZS (Soybeans), ZM (Soybean Meal), ZL (Soybean Oil), ZC (Corn), PL (Platinum)
Down: CT (Cotton), ZW (Wheat), PA (Palladium), ZO (Oats)



News for the day:

PMI Manufacturing Index: 9:45a
ISM Mfg Index: 10:00a
Construction Spending: 10:00a

*Red highlight means the news is a market moving event;
yellow highlight means the news merits attention


Projected ES price action for the day: Like a ping pong ball, prices once again have bounced from low to high within the 1835-1875 high volume composite profile. Since we know that a significant amount of business has been conducted inside the range, the price action is more likely to be choppy as the bulls and bears look to build momentum for a breakout trade.  The trading activity at the open will be key to notice if there is any profit taking prior to a potential liquidation break. There has been some buying during the premarket and the first topside target is Monday's high of 1868 before a test of the 1875 level.  If prices can clear 1868, then the intraday bias will be more bullish. Any activity within Monday's range will be a coin toss for a breakout in either direction and should be traded with care.

Stock of the Day: Caterpillar Inc. (CAT)- 52 weeks high made today

ES Daily Trend: Neutral/Bullish

ES Weekly Trend:  Bullish

ES Monthly Trend:  Bullish