ER Analysis 02/01/07

[TinGull]

Happy February!



Yesterday we saw some good buying post FOMC announcement. When there’s good buying, there has to be also some good selling to those buyers. Who were the sellers? We’ll wait for the next couple days to pan out and see. Our TPO count shows 295/112 in favor of the sellers.



Our numbers are as follows for ER2:

VAH: 803.3

POC: 798.9

VAL: 795.1

As you can, a very very wide value area. Price has traded outside value yesterday afternoon, only to come crashing back down into value within the last 30 minutes of trading to end only slightly above the value area. That, I think, is something to keep an eye on. Also, the fact that all other indices are trading up right now, but the russell is in the red is also something to note. A lot of times the Russell leads things, so keep a close eye there.

While we have a chance to open into value, we might look for potential short setups being so far away from the bottom of this range we’ve been in. Short at VAH IF we open inside of value would be a nice play.

If we open outside of value and very close to the VAH, an opening TICK play could be in effect. Watch for positive ticks on the russell and price to start to make a little run for it and jump on.

With the value area as wide as it is, I’d definitely look to the POC as an area of support/resistance today. Price will need a place to rest inside the value area, and I think that is a likely spot.

As I said, we’re at the top of a range:




I’ll be weary of longs until we get a close above that 807 level. We couldn’t even close above all time highs yesterday. Definitely something to watch.