By Mike Paulenoff, MPTrader.com
For the second time in a week, the employment data turned out to be the trigger mechanism for much higher prices. Last Friday you had the big up-move on better-than-expected employment data for the month of September, which surprised the market, and then today you had a much bigger-than-expected drop in unemployment claims. In both cases, the news came out an hour before the opening bell, and in both cases the market surged right out of the blocks for an hour before the cash markets even opened. So, there wasn't much left to do.
We were on the sidelines after yesterday, looking at yesterday's peak as possibly being significant. Obviously, it wasn't significant at all. Another set of upside projections were generated off of today's first-hour surge, and as we speak we are nearing those projections. Those projections we're looking for in the S&P E-Mini are 1049-52. Right now we?re at 1045, and it looks like we?re doing the typical rest period during the noontime hours on the East Coast.
Having said that, there has been very little pullback in the market, which is tantamount to just how bullish the market is at the moment and how little selling pressure has come into the market even on an intraday basis. So we expect higher prices in the E-Mini S&P at 1049-52. If we go over to the E-Mini Nasdaq, it's trading at 1416 with a 1420 high, and our work is telling us to expect 1426-30 as an upside target before some serious selling pressure comes in.
It could be just profit-taking. Nonetheless, it looks to me that the up-moves from the most recent pivot reversal to the upside which occurred yesterday afternoon at 1377 in the E-Mini Nasdaq and at 1029 in the E-Mini S&P -- those up-moves appear to need to one more surge to the upside towards 1050 in the S&P and towards 1425 roughly in the Nasdaq to complete the up-legs from yesterday's pivot reversals, at which point I think we'll have a two-way market.