Tuesday, September 08, 2009
Midday Briefing for September 8th: Trying to Shrug Off Weakness
As we can see from the Market Delta chart above, we sold off from the open, with more volume at the bid than offer in ES (bottom histogram). We have not seen significant selling pressure in NYSE TICK, however, and the continued weakness in the U.S. dollar has supported stocks as well as commodities. As a result, we're trading around the day's volume-weighted average price, building volume (side histogram) in the area around ES 1024. How we trade around that volume bulge will be important going forward; a rejection of that level and move to new highs would set us up for a test of the bull highs. Failure to make new highs would keep us in a range defined by the overnight highs and the early morning lows.
I will be particularly attentive to watch for sector confirmations and non-confirmations of any move to day highs. At this juncture, the positively-skewed NYSE TICK and dollar weakness are supportive of such a move.