TFP market summary for Wednesday February 6, 2013 | $CL_F $USO $AAPL

5 min ES

Equity indexes continue to gyrate over the 1500 level as the bond trade finds buyers in the face of a possible pullback the media has mentioned every other phrase for the last 3 days. ES currently @ 1507.25.

Will the pullback come? well if the ES breaks under 1505 this evening its back to 1500 which has air under into 1495 with 1490.25 being the finito line in sand before sell stops get hit flipping momentum lower on 30 min charts.

1 min AAPL showing ramp

On the flip side the ES has pinch resistance up at 1508.50 with overnight resistance @ 1510 and 1511.25. Over these levels means 1515. Play it as the cards drop.

The NQ lagged the ES today falling 6 points into 2730 support before finding a big to close just over 2740. The weakness was due to the fact Apple dragged on the tape following early rumors of a possible share repurchase and a Legg Mason analyst stating the Apple’s shares could be worth 50% more than than are currently trading. This sent apple shares up from 452 to 466 in about 15 minutes before running out of momentum to fall back to close at 457.35.

Apple trades exdiv tomorrow FYI. look for weakness off open.

1  min TLT vs SPY

The notable event of the day is strength on the 10 and 30 year bonds around noon eastern time. This strength pushed the ES sharply lower from 1508.25 down into 1501.50 before buyers stepped back into push the ES highs into the close.

Bonds followed the equity indexes higher into the close making us wonder who is fibbing, bonds or stocks. Tonights overnight action should help resolve this question as bonds are off their highs.

5 min CL . note the low and then pinch

Crude oil stood out today as the failure of the 96.50 level early Wednesday morning converted into a drop all the way into 95.05 before buyers stepped onto the tape in a big way sending crude’s price up to make a high of 96.82.

When looking at the 5 min CL chart on the right focus on the 95.59 area with the red line pointing to the words ‘pinch’.

CL pinches are ‘most of the time’ breaks over a sharp downtrend on a bounce, this pushes late shorts into covering and propels momentum higher. In today’s case the pinch was the perfect storm to drive prices vertical.

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