News of the EU debt resolution sparked a huge rally as depicted on the ES emini chart above. The ambush zone was broken and we expect this rally to continue to through to the end of the year.On the SPY weekly chart below we are targeting the $148-149 level which represents an extension of 23.6%. All future fib pullbacks will be measured from highs to highs where August high is the base, until the pattern fails.
We saw some profit taking into the close on Thursday. Buyers stepped in half way back of the US trading hours price levels. Then we traded all the way half way back short, and held within that range overnight Thursday and all day Friday. Short-term, we don't expect wide price expansion ahead of Friday's jobs data, notwithstanding a catalyst. In the meantime our trading is guided by the 15 min. Fib. levels.Friday's daily bar is narrow, in the upper range of Thursday's WRB which is bullish. A few more upper inside bars would lead to a coil.
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