Chart Analysis: Veteran traders know that earnings season generally causes an increase in market volatility due to more traders watching the markets during these times and earnings surprises. Yesterday, we witnessed a 9% drop in Google stock ($GOOG) after news with Google’s disappointing earnings report. This was a result of the report being released early by accident, which subsequently brought Google to a halt for part of the day. With confidence shaken in the investors of this stock as well as some stocks whose companies have similar business models, we may see a change in the winds of this popular financial futures product. Today’s NinjaTrader chart of the day analyzes the larger market picture using the S&P 500 Futures ($ES_F). On this Daily NinjaTrader chart, we can see that over the past year, the Emini S&P 500 Futures have seen a very healthy overall bullish trend with a retracement and correction between March and June. NinjaTrader provides many free tools for investors to make decisions when trading during earnings reports. As the 21 and 50 day Simple Moving Averages (SMA’s) near each other and are penetrated by recent price, we could see an end to this trend. Another indication of this bullish rally coming to a possible end is price breaking the 0% tine of the Andrew’s Pitchfork drawing object on the chart. The Relative Strength Index (RSI), which is plotted at the bottom of this chart, is another indicator that many traders use to identify turning points in the market. Whatever the case may be with the Emini S&P Futures, it is highly likely that we may see some investors moving to other markets for the time being. This chart was created with free end of day data from Kinetick and free tools available with the NinjaTrader platform.
MrTopStep, its officers, and directors are not agents, representatives, or affiliates of the CME Group. Trading Futures, Options on Futures, and retail off-exchange foreign currency transactions involves substantial risk of loss and is not suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. Any decision to purchase or sell as a result of the opinions expressed in these report(s) will be the full responsibility of the person(s) authorizing such transaction(s). BE ADVISED TO ALWAYS USE PROTECTIVE STOP LOSSES AND ALLOW FOR SLIPPAGE TO MANAGE YOUR TRADE(S) AS AN INVESTOR COULD LOSE ALL OR MORE THAN THEIR INITIAL INVESTMENT. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS.