TF & NQ

April 10th, 2011

The TF came down to the prior breakout level at 835 late last week. A re test of a prior high break out is normal and it is bullish. It is easy to think short from a level like this and we did play IWM puts when the TF was at 825 but it was not a easy trade and the end result was we broker higher which is showing strength.

There are targets at the last high at 855 but for right now we would have to say there is more strength then weakness in the market. Of course this can change fast but if the 835 low holds Monday and Tuesday there is a good chance we break the 855 high.

We think the main thing to watch next week is the NQ. Thursday and Friday the NQ was corrective and so far the support has held. Support in the NQ is 2280 so if that level holds we will be looking for a move up to the 2390 to complete the mid term pattern. Once 2390 is hit then we would think that the NQ will correct back down to the 2300 to make its final decision that could be a decision for the next big move.

Also if you look at the 60 min NQ chart you can see we are building a inverse Head and Shoulders pattern and if that pattern fires off the move will be explosive.

Where we are at with the Indexes it is best to look at both sides until one pattern clearly takes charge. This is not a point in the pattern to be stuck on one direction only. If you are a swing trader short here and we break the 2375 we would not hold short any longer.

Happy Trading,

www.eMiniSchool.com