12:57 pm EDT:  There has been little if no selling on the nominal new contract high.  As always, we are careful to watch for spike reversals at highs on an important report (Housing Index in 3 min. at 1:00 pm).  However, if weekly R1 at 1097.25 is cleared, there is no further resistance until 1103.00 to 1104.00.  Be careful with longs if the ES trades below 1090.25.

The Precise Take – ES higher overnight into housing stats week

Leaders Analysis:   No moves to speak of, except crude inches to new yearly highs.  30 Year T-Bond futures, the EuroYen and the US Dollar are mostly consolidating.

Medium Term Analysis:  As we wrote Friday, the focus this week is on housing data, which is not expected to disappoint.  PPI tomorrow could weigh a bit on equities the way Chicago PMI and Durable Goods did a few weeks prior, and it is concurrent with Housing Starts, so that will be a critical time for the markets if they are at major support or resistance.  Next week will be a bit tougher for equities in terms of news, so longs will want to push to new highs while the going is good, and 1126.25 is a reasonable target this week.  A close in the ES below last week’s low of 1077.50 puts the rally in jeopardy.

Trading Today:  After taking out Friday’s low by a few points early overnight (low 1076.25), the ES traded sharply higher (1089.50).  There is a large support area with pivot, Fibonacci and market profile support that spans 1080.25 to 1085.00.  The ideal early long is from 1083.50 (closing VWAP) to 1085.00 (combined session daily pivot); however, we’re willing to consider longs all the way down to the…

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