S&P 500 Emini Day Trading Gap Wednesday July 22, 2009

S&P Emini 500 Futures gapped up 8 points on the open of 954.25.  The open was within a tick of the day’s high, 954.50, which was reached in the first 5 minutes of trading.  Prices dropped in the next 45 minutes of trading and filled the gap.  After a pierce of the point of control, 945.50, traders retraced about 70% the morning’s range.  From there, the Emini futures dropped to the day’s low of 939.50.   From 12 pm to 2 pm, a rough inverted head and shoulders formed.  That’s often a bullish signal.  Today, it proved to be true.  After a false breakout to within a tick of the point of control, prices declined about 3 points, then the buyers validated the bullish indication.  Notice how the point of control became resistance when prices fell below, then became support, briefly, on the way back up.  Today’s action had a 15 point range, that retraced 76.4%  to close at 951.25.  Volume was average at 1.87 million contracts.