Tuesday, November 17, 2009

Morning Briefing for November 17th: Building Value Lower

Here's how we're setting up prior to the open in the ES futures. The Market Delta chart will require some explanation. Each bar is drawn to represent the volume distribution within the period; each period represents 200,000 contracts. We see yesterday's and this morning's market, but the cumulative volume histogram at right is for the current day's session only.

What we see is that we've been building volume overnight below yesterday's volume bulge around ES 1108-1109. I will be watching how we trade relative to the overnight range closely, to see if we can sustain yesterday's strength or retrace much of the move. Note that we're seeing U.S. dollar strength, which, if sustained, could weigh on stocks during the regular trading session.