Emini S&P needs to short term recovery to unwind oversold conditions

Daily Forecast - 12 January 2016

S&P March contract

Emini S&P needs to short term recovery to unwind oversold conditions but will need to break & hold above 1922/23. A break above yesterday's high at 1929 should confirm a move towards strong resistance at 1936/37 & the main challenge for bulls today. Try shorts with stops above 1942. A break higher however sees 1936/37 act as strong support to target 1946/48, perhaps as far as strong resistance at 1952/53.

Failure to beat first resistance at 1922/23 keeps us trading sideways & targets 1913/12 then 1902/01. If we continue lower look for a retest of yesterday's low at 1893/92. Any longs need stops below 1889 to target strong support at 1883/82. A low for the correction is possible here but longs need stops below 1976. Further losses target 1871/69 then September lows at 1861.

E Mini Nasdaq March contract

Emini Nasdaq severely oversold with signals that a short term recovery is possible, or at least a more sideways direction in to the end of the week. First resistance at 4280/85 is key to direction this morning. A break higher targets 4302/05 then strong resistance at 4323/28. A good chance of a high for the day but shorts need stops above 4337. A break higher however sees 4328/23 act as strong support to target 4355 then 4362/66.

Failure to beat first resistance at 4280/85 targets minor support at 4253/50. If we continue lower look for 4227/24. Further losses however meet an excellent buying opportunity at 4210/05. *It is very possible we will see a low for the day correction here at this stage.* Just be aware of further important 100 week moving average at 4185/80 in oversold conditions. Longs need stops below 4170. A break lower however targets 4150/45.

Emini Dow Jones March contract

Emini Dow Jones same levels apply for today with first resistance at 16325/335. Shorts need stops above 16380!! A break higher today could target a selling opportunity at 16450/460. Shorts need stops above 16500. Just be aware that a break higher could then target 16590.

Below 16240 adds pressure for 16150/140. Further losses risks a retest of yesterday's low at 16085. There is a good chance of a low for the day here again but longs need stops below 16040. Further losses target 16015 then 15960 before October lows at 15910/08. A break below 15900 risks a slide to September lows at 15800.