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A Strong Open For The DJIA And S&P 500

Following a textbook U.S. CPI release, both the DJIA and S&P 500 SPX have opened trade in the green. Yesterday, a strong open was also evident, with optimism fading as the session progressed. We will see if the positive sentiment is set to last as the trading day wears on.

From a fundamental standpoint, we are in the midst of a super-charged news cycle. A coming vote on U.K. PM May’s leadership is due later in the session. Earlier, U.S. CPI for November was released to the public. The numbers came in on schedule, at 0.0% month-over-month and 2.0% year-over-year. In addition, the CPI except Food & Energy (Nov. YoY) came in as expected (2.2%).

E-mini DOW Futures

Tuesday was a tough session for the December E-mini DOW. Traders were happy to bid the market higher early, but the sentiment faded toward the close. Perhaps today will bring a different result.

December E-mini DOW Futures (YM), Daily Chart
December E-mini DOW Futures (YM), Daily Chart

Here are the levels to watch for the rest of the trading day:

  • Resistance(1): Daily SMA, 24892
  • Resistance(2): Bollinger MP, 24964

Bottom Line: At press time, it appears that the DJIA and E-mini DOW are heading for a retest of the 25000 psyche barrier. For the remainder of the day, I will have sell orders in the queue from 24949. With an initial stop at 25011, this short-term position trade produces 60 ticks on a 1:1 management plan.

If you are trading quarterly futures contracts such as the E-mini DOW and E-mini S&P 500, be aware that Thursday, December 13 is the rollover day for many issues. Be on the lookout for split contract volumes and lagging liquidity as we move into the Thursday session.

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Shain Vernier
US Analyst
Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.
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