Good news is, the e-mini S&P futures has moved up overnight. Bad news is, it's still resting on the lower end of a slightly up trend from last Thursday's 95 point rally. For a confirmed follow through, we need to at least break above the 870 level during market hours. If S&P do break above 870, then my target is 920 and possibly 940, the upper range of this uptrend. However, and it looks like a distinct possibility from here, if we break below 845 / 836 (200 bma) today, then 800 is an obvious target. Breaking below 800 would mean 770 is in the works. A bear trap / bull shakeout could also occur at the 820 level, that would be the line in the sand for a rally or breakdown for the intermediate term.
[caption id="attachment_897" align="aligncenter" width="500" caption="e-mini S&P 500 futures"][/caption]
US Dollar Index is in a slow downtrend as we speak. We could retrace to 87.20 and then head back down to 85.70. Breaking below 85.70 without retracement would be a strong sign of this breakdown. Moving above 87.0 at this point would be signs of strength. So I would watch the action above 87.0 and below 86.0 today.
[caption id="attachment_898" align="aligncenter" width="500" caption="US Dollar Index"][/caption]
Lastly, gold is still in a strong uptrend. Breaking below 795 would signal caution to a big retracement or even a downturn. Otherwise, a steady rise from here would be healthy. Breaking above 820 and taking out yesterday's high of 831 could become explosive to the upside.
[caption id="attachment_899" align="aligncenter" width="500" caption="Gold"][/caption]
It's interesting to see all three of these markets trading in a textbook-perfect range. It's difficult to tell rather we'll move up or down in the S&P at the moment. If we are stuck in a trading range today, which I think is the most likely to happen, then I'll be looking down below.
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