Yesterday morning post needs a special reference--from IQBAL LATIF on Feb 24 1999 8:42AM EST
<<Composite above
2382 has to sustain its momentum and if we need to see this resistance been taken
out we need complimentary signals from lagging indexes like RUT and DJT BKX.
A weakness in all of these should be exploited for a re test of 1252 SPH level.>>
We did test composite 2401 from where we retreated, composite tried to hold the 2382 area but could not withstand the sell programme and closed at 2343.RUT inability to take out 402 was first sign of trouble..We did come down and closed at 1253 0n SPH. DJT and BKX initially strong gave up most of their gains in case of BKX and DJT at one point up 85 almost closed up 25. The test of 2401 according to pits eliminated lot of short positions and I have news that people were long at 1284, this is poetic justice of market, it first rattles the shorts turn their postions to long and bring the market down to test this 1251 support.. The move up in the morning let a lot of shorts to cover and get whipsawed.
To avoid this whipsaw I had indicated this in my post..
<< I would
rather like RUT above 402 asap if 1278 on SPX is taken out.If RUT keeps lagging
I will like to buy some 1250 puts for March anticipating that we may have a false
break to test 1251 before we take out 1278 or 1290 on SPH, I know that premium
does not warrant this huge gap in SPX reading and SPH. I am using SPH for
intra-day long positions and SPX for position long.>>
The most significant issue of future projection is contained in this paragraph, we saw SPH at 1286 and SPX at 1282, you note that despite of both levels breaching the 1278 SPX and 1282 SPH resistance,I insisted earlier in the day that level for intraday long was at 1290 on SPH whereas for position trading I demanded a double close above 1278 on SPX, this was intended to save people from whipsaw move, even if 1278 was taken out my requirement on double close made me hesitant to go long and I kept waiting for that 1290 resistance which never was breached for a long trade intraday.
I hesitated to go long until 1290 on SPH is taken out or 402 on RUT in absence of these two elements, I was quick enough to go long 1250 puts when I saw 1282 taken out on SPH.This is important to see that old highs of SPX and SPH sometime have diffeent targets, yesterday was one of those days..
Test of 1251 was predicted day before and I asked for some puts to be bought as I knew that it is more than likely that a move from 1215 to 1284 needs a retracement to 1251. I would think today can be another interesting day we may open softer or we may test 1248-45 area, however if BKX 802 SOX 410 is maintained I would consider a trade to go long at 1239-35 area if we ever test that with a stop loss at 1224 break. If towards the end BKX DJT RUT contnues to show weakeness I will like to add some 1180 long puts purely for trading. |
