Mar 052010
Big pop off the good employment number putting us into the 30s ahead of the open with an 8 handle gap or so. Lots of “skipped” over prices for some good rejection fades. The trend trades are going to be long if we were to buy the dips but ATO will look to fade and breakout with narrow targets for higher probability moves. The programs will kick in HARD at the open so watch the volatility and be a little flexible with the stops. We will look at the first test of the ON high at 31.50 for a potential fade back to 30. The breakout trade above 31.50 is riskier so we would wait to get long around 32.50 and target 34.50 and/or on to 36.75 but this is a MAJOR congestion area. WATCH FOR REJECTION STARTING AROUND 37.50!!! Take profits there and if it presses up you can get back in at 39.50 or so and trade to 40.50 and beyond. We would also fade a retracement to 28.50 and trade long back to 30 an/or on to 31 ahead of the high. If it trades lower 25.75 is another fade back into 27.50. On the short side we would sell sell 27.50 into 26.25 if it comes up as well as 25.25 into 24.50 and on to 23.50. At least a partial gap fill is very probable today.

 Posted by at 9:17 am

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