Your MUST-READ Morning Stock Futures Cheat Sheet: Breakout?

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The Precise Take – Breakout?

Big Picture Analysis:  Without delving too much into the endless speculation regarding Bernanke’s Jackson Hole speech, what we know for sure is that there will be no immediate new measures, but there might be in the near future, as the September 21 meeting has been expanded to include the day prior.  Last year’s JH speech was a short term sell the news opportunity, but a bottom was quickly found in early September.  Looking at the price reaction after the brief, but tumultuous, dip on Friday post-speech, and the overnight price action, we may indeed be seeing a breakout in the ES from the consolidating wedge it has formed this month.  Though not the mots likely scenario, we still would be on alert for a reversal after the open, which would suggest a short term bull trap has developed.  If there is continuation, the upside targets are the 50% retracement of the down leg at about ~1230 and a measured move, which would target ~1240.  Regarding our comment about Thursday’s CANSLIM distribution day, an important clarification that was made to us later in the day, which is that the higher volume component was largely from the abnormally high trading volume of BAC following Buffet’s purchase.  For the intermediate term, we still remain skeptical of any short term rally here until breadth stages a more convincing reversal and liquidity improves.

Trading Today:   Below are marked the support and resistance areas.

Today’s  Scheduled News (all times EDT)

Major Market Movers
Pending Home Sales at 10:00 am

Minor Market Movers
Dallas Fed Mfg Survey at 10:00 am

Tomorrow’s Scheduled News

Major Market Movers
Consumer Confidence at 10:00 am
FOMC Minutes at 2:00 pm

Minor Market Movers
S&P Case Shiller HPI at 9:00 am


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