Hello All,
What a way to start the year. Almost all markets were higher across the board, great enthusiasm and a precursor of what is to come for 2010. Many markets should be completing wave patterns over the next session or so. The ES bounced off the 1110 region and finally got to my 1130 target. Crude has crossed above $80 and is hovering just below the previous top around 82.50. The Euro is close to completing upside patterns towards 1.4994. And Gold has reached my 1120 target. We must note that even though the ES and Gold have reached their targets, the pattern completion for Crude and the Euro should allow for additional upside. Crude may take until the API or DOE data to break up towards 84.50 or 85.00. The Euro should be able to kiss the 1.45 region and hold support just below 1.4400 overnight. Relatively, ES could reach up to 1140, and Gold can reach 1145.
Even though the markets are moving favorably and in the directions I'd like with respect to my option writing program, I do not feel these particular levels provide a proper risk/reward for trading futures. Scalpers feel free to pick off as much as you can, but there are too many support/resistance levels that can come into play given new year conditions. A lot of new money came into play today, and the trend is evident, lets hope it stays in tact for another session to confirm pattern completions.
Best,
Arman Vahdatinia
Futures & Options Strategist
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