We’ll be on hiatus, so today is the last note until the 15th.

The March e-mini NDX (NQ) traded in a tight range of 84 bps yesterday, with no test of Tuesday’s high or low and it closed down 0.50 points at 1852.  Yesterday’s equity session started strong and NQ reached its 1861.25 high within the first 90 minutes.  Over the next half hour, NQ retested the high twice before it rolled over.  The decline paused near the morning low (1851.50) before NQ sold off again and tested the 1848 level (1845.75 low).  The rally off the low found resistance at 1853, the bottom of the 1853 to 1894 range from 12/24 to 1/20 mentioned yesterday.  We also noticed that 1856 has provided resistance over the past 2 days, it is a Fibonacci extension based on the trading between 2/5 and 2/25.  Overnight trading took NQ below yesterday’s low (1844.25), with it back in positive territory at the moment.  Support @ 1848, 1841.75, 1825, 1813.75, 1804, 1788.75 and 1774.50.  Resistance @ 1864, 1871.75, 1886.75 and 1902.75.

Chart Source: TradeStation

We’ll be on hiatus, so today is the last note until the 15th.

The March E-Mini S&P (ES) closed 1118.50 yesterday, up 1 point to extend its win streak to 4 days.  There was no test of the 50% Fibonacci retracement (1126.25 vs. 1125 high), but the 1119.25 level provided resistance.  At the start of yesterday’s equity session, 1119.25 provided support as ES was on its way to the 1125 high about 90 minutes later.  From the high, NQ trended lower and about 3 hours later it retested 1119.25.  The break of the level took ES to the 1115.50 equity session low (1115 low on the day) before it rallied back to test 1119.25 over the final hour.  Volume was up a little, but it remains very weak.  Following up on yesterday’s comment about how it’s difficult to be bullish here, we take a look at the S&P Depository Receipts (SPY) instead of ES because some candlestick formations don’t apply in 24 hour markets.  Notice the long upper shadows in SPY over the past 2 days – early rallies are being sold off into the close – not a bullish sign.  Overnight trading took ES below yesterday’s low down to 1114, with it back near unchanged ahead of Jobless Claims.  Post claims, ES is back testing the 1119.25 level.  Support @ 1119.25, 1108, 1103, 1096.25, 1084.50, 1069.50 and 1061.  Resistance @ 1126.25, 1131.75, 1148.25, 1153, 1168.25 and 1184.

Chart Source: TradeStation

The March e-mini NDX (NQ) rallied up to 1862.25 yesterday - no test of the 1864 level – but it faded over the final 2 hours to close 1852.25, up 52 bps.  NQ began yesterday’s equity session above the 1848 level and traded sideways with a slight upward bias into the 1862.25 high 4 1/2 hours later.  From the high, NQ moved lower and 2 hours later it tested the 1848 level (1846.50 low, 1842.50 low on the day).  1848 held and NQ ticked up a bit into the close.  Yesterday’s reversal off the high could have been caused by the supply that NQ ran into from the 12/24 to 1/20 range – about 1853 to 1894.  Something we also noticed is the continued absence of volume that we also highlighted on the chart.  As long as there is no close above 1864, we see no need for further upside projections.  Overnight trading tested the 1848 level (1847.75 low), with NQ back in positive territory here.  Support @ 1848, 1841.75, 1825, 1813.75, 1804, 1788.75 and 1774.50.  Resistance @ 1864, 1871.75, 1886.75 and 1902.75.

Chart Source: TradeStation

The March E-Mini S&P (ES) added 3 points yesterday, as it followed through on Monday’s gain and closed 1117.50, 1 tick below the midpoint of yesterday’s narrow 1112.75 – 1122.75 range.  ES oscillated around the 1119.25 level for all of yesterday’s equity session and traded within an even narrower range of 1115.25 – 1122.75.  Volume continued to decline yesterday and the volume picture makes it difficult to be bullish here.  The decline into early February was on increasing volume and the rally over the past month has been on declining volume.  Is this a “climbing a wall of worry” kind of thing?  There was no test of the 50% Fibonacci retracement (1126.25) of the range from the October 2007 (using the December 2007 contract – 1586.75 high) to the March 2009 (March 2009 contract – 665.75 low).  A close above there and we would have to look for higher prices.  Overnight trading has been in a 4.5 point range with no test of the 1119.25 level.  Support @ 1119.25, 1108, 1103, 1096.25, 1084.50, 1069.50 and 1061.  Resistance @ 1126.25, 1131.75, 1148.25, 1153, 1168.25 and 1184.

Chart Source: TradeStation

* Factor - the number of ETF shares that are approximately equivalent in notional value to the notional value of one futures contract

Chart Source: TradeStation

Chart Source: TradeStation

* Factor - the number of ETF shares that are approximately equivalent in notional value to the notional value of one futures contract