Friday, July 10, 2009

Morning Briefing for July 10th

Before trading, you might want to investigate the President's second stimulus package; meanwhile, here's how we're trading going into 7:30 AM CT trade imbalance numbers (bottom chart). Note that we failed at the prior day's highs yesterday and now are moving back into the Wednesday range, with strong dollar and weak commodities accompanying the move. I will be posting more later this AM.

8:03 AM CT - I've added the top Market Delta chart for ES to show how we're building volume in the 871.50 to 873 area during premarket trading. I'll be looking to that level as a reference range to gauge our ability to sustain early strength or weakness. Given yesterday's fail at the prior day's highs and the overall short-term weakness of the market, I'd expect at least a test of the Wednesday lows today. Failure to sustain trade above today's VWAP will be an important tell for such a test. If we cannot get down to and sustain those lows, a move to the volume bulge in the 876/877 area would be a near-term upside target. I'll be meeting with traders actively through the AM, but will update the market between visits via Twitter.