Don't Underestimate Yesterday's Market Action

Hello traders everywhere! Adam Hewison here, co-founder of MarketClub with your mid-day market update for Thursday, the 10th of November.
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Don't Underestimate Yesterday's Market Action

Yesterday's action in the equity markets is a grim reminder of just how fragile the economic and financial system is globally. We would not dismiss the market action as just another pullback in the market.

The sharp down move should not be ignored, in my opinion. We are looking at a key support level on the S&P 500 at $1220. A close below that level will accelerate the decline to the next key level of support, which is $1180. That move may have to wait until Friday as traders jockey for positions today.

For the year, the S&P at the moment is down, the NASDAQ is flat, and the DOW is barely higher with gain of 3%.

The copper market gave a pretty strong negative signal yesterday, as it moved below the $3.50 level. The copper market is telling us that demand is just not there for this industrial metal.

For some time now, we have been discussing the trials and tribulations of Europe and all the drama that has become a Greek tragedy. The fact that they have a new prime minister in Greece does not change one thing, in my opinion. Italy is now the star of the show, and we are not convinced that Prime Minister Berlusconi is going to step down off his pedestal anytime soon.

Politicians still have a "quick fix" mentality and are counting on that to solve this mega financial mess. The reality is, there is no quick fix. It is going to take years for this mess to be cleaned up, and in all likelihood it will get ugly.

The best thing a trader can do at the present time is to watch the market action, as it will tell you exactly what to do. We believe the rest of this week is going to be a very important one, particularly where we close tomorrow. If we have a negative close on Friday below $1220 on the S&P 500, we would then expect to see this index move lower for the balance of November.

Now, let's go to the charts and the video and see how we can create and maintain your wealth in 2011.

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S&P 500 INDEX
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OUR VIEW: $1250 resistance - $1226 support

The massive move down in this index yesterday cannot be ignored by this observer. We still believe that the $1220 level holds the key for the S&P 500. With a Chart Analysis Score moving between -65 and -75, we may just be on the brink of an emerging downtrend. That still needs to be confirmed basis our weekly Trade Triangle indicator. Intermediate traders should be on the sidelines waiting for a new Trade Triangle short signal. Long-term traders should either be in cash or continue to hold short positions in this index.

See today's S&P 500 Video Here.
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Monthly Trade Triangles for Long-Term Trends = Negative
Weekly Trade Triangles for Intermediate Term Trends = Positive
Daily Trade Triangles for Short-Term Trends = Negative
Combined Strength of Trend Score = -65
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Suggested S&P 500 Trading Instruments:
Non Leveraged ETF's: (Long SPY) (Short SH)
2 x Leveraged ETF's: (Long SSO)(Short SDS)
Futures: Contracts are available to trade this market. Contact your broker
Options: Options Contracts are available to trade this market.Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.

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IS PERSONAL MARKETCLUB COACHING RIGHT FOR YOU?
Free consultation. 877–219–1482
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SILVER (SPOT)
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OUR VIEW: Trading Range

The spot silver market slipped to its lowest levels in eight days before recovering. This market remains in a broad trading range bound by $33.50 an ounce on the downside and $35.50 an ounce on the upside. With our Chart Analysis Score reading -55, we seen no clear-cut trend at the moment for this metal. Generally speaking, the major trend for silver continues to be negative based on our monthly Trade Triangle and the intermediate weekly Trade Triangle remains in conflict. Long-term traders should continue to hold short positions in silver with appropriate stops.

See today's Silver Video Here.
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Monthly Trade Triangles for Long-Term Trends = Negative
Weekly Trade Triangles for Intermediate Term Trend = Positive
Daily Trade Triangles for Short-Term Trends = Negative
Combined Strength of Trend Score = -55
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Suggested SILVER Trading Instruments:
Non Leveraged ETF's: (Long SLV) (Short the ETF SLV)
Leveraged ETF's: (Long AGQ) (Short ZSL)
Futures: Contracts are available to trade this market. Contact your broker
Options: Options Contracts are available to trade this market.Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.

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IS PERSONAL MARKETCLUB COACHING RIGHT FOR YOU?
Free consultation. 877–219–1482
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GOLD (SPOT)
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OUR VIEW: Looking for a cyclic low in gold tomorrow.

Today's move in the gold market push gold to its lowest levels in five days before recovering. We expect gold to begin to consolidate around the $1,750 area, give or take $10 - $15 either way. Our Chart Analysis Score remains intact, with a positive +75 reading indicating that this market is in strong hands. With gold moving higher it indicates to us to be very concerned about what is happening in Europe and the financial markets. Long-term, intermediate term and short-term trends remain positive for this precious metal. Intermediate and long-term traders should maintain long positions with the appropriate money management stops in place.

See today's Gold Video Here.
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Monthly trade triangles for Long-term trends = Positive
weekly trade triangles for intermediate term trends = Positive
daily trade triangles for short-term trends = Negative
Combined Strength of Trend Score = +75
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Suggested GOLD Trading Instruments:
Non Leveraged ETF's: (Long GLD) (Short the ETF GLD)
Leveraged ETF's:(Long UGL) (Short GLL)
Futures: Contracts are available to trade this market. Contact your broker
Options: Options Contracts are available to trade this market.Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.

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COPPER (DECEMBER)
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OUR VIEW: Fibonacci support at $3.30

The pullback today in the copper market came very close to achieving a 61.8% Fibonacci retracement level at $3.30. Only our weekly Trade Triangle remains positve and we expect that this indicator will turn negative again. Copper generally reflects economic conditions, and as such is influenced by equity prices. With a Chart Analysis Score of -65, this metal is beginning a downward trend that will be confirmed when our weekly Trade Triangle turns red. Generally speaking, the major trend for this metal continue to be negative while the intermediate trend is in conflict. Long-term traders should continue to hold short positions in copper with appropriate stops.

See today's Copper Video Here.
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Monthly Trade Triangles for Long-Term Trends = Negative
Weekly Trade Triangles for Intermediate Term Trends = Positive
Daily Trade Triangles for Short-Term Trends = Negative
Combined Strength of Trend Score = -65
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Suggested Copper Trading Instruments:
Non Leveraged ETF's: (Long JJC)
Futures: Contracts are available to trade this market. Contact your broker
Options: Options Contracts are available to trade this market.Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.

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CRUDE OIL (DECEMBER)
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OUR VIEW: Mixed signals on this one

We suspect that the crude oil market, basis the December contract, will have problems between the $97 a barrel to $100 a barrel level. With a Chart Analysis Score of +70, this market may be trying to move out of its broad trading range and reach the $100 mark. The $100 level represents a 61.8% retracement of the entire down move starting from the highs seen earlier this year in April. Intermediate term traders should be on the sidelines. Long-term traders should continue to be short the crude oil market.

See today's Crude Oil Video Here.
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Monthly Trade Triangles for Long-Term Trends = Negative
Weekly Trade Triangles for Intermediate Term Trends = Positive
Daily Trade Triangles for Short-Term Trends = Positive
Combined Strength of Trend Score = +70
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Suggested Trading Instruments:
Non Leveraged ETF's: (Long USO) (Short the ETF USO)
Leveraged ETF's: (Long UCO) (Short DTO)
Futures: Contracts are available to trade this market. Contact your broker
Options: Options Contracts are available to trade this market.Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.

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IS PERSONAL MARKETCLUB COACHING RIGHT FOR YOU?
Free consultation. 877–219–1482
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DOLLAR INDEX
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OUR VIEW: Going higher

We believe today's action in the dollar index pushes this market higher. With the index moving over near term resistance at $78.00 today, we expect to see further upside action. We are now looking for a test of the $79.50 - $80.00 levels. Our longer-term monthly Trade Triangle remains in a positive mode and our intermediate term weekly Trade Triangle turned positive yesterday. Long-Term and intermediate term traders should maintain long positions with the appropriate stops in place.

See today's Dollar Index Video Here.
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Monthly Trade Triangles for Long-Term Trends = Positive
Weekly Trade Triangles for Intermediate Term Trends = Positive
Daily Trade Triangles for Short-Term Trends = Positive
Combined Strength of Trend Score = +90
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Suggested DOLLAR INDEX Trading Instruments:
Non Leveraged ETF's: (Long UUP) (Short UDN)
Leveraged ETF's: (Long) (Short)
Futures: Contracts are available to trade this market. Contact your broker
Options: Options Contracts are available to trade this market.Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.

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REUTERS/JEFFERIES CRB COMMODITY INDEX
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OUR VIEW: Trading Range +55

As we blogged yesterday, this index may be close to a reversal and running out of steam. Like many of the other markets we are tracking right now, the CRB index is in a trading range with a Chart Analysis Score of +55. Resistance is evident at the $325 level and support comes in around the $315 area. Look for these levels to contain the market for the balance of the week. Our longer-term Trade Triangle remains negative for this index. Intermediate term traders should be on the sidelines. Long-Term traders should maintain short positions with the appropriate money management stops in place.

See today's REUTERS/JEFFERIES CRB COMMODITY INDEX Video Here.
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Monthly Trade Triangles for Long-Term Trends = Negative
Weekly Trade Triangles for Intermediate Term Trends = Positive
Daily Trade Triangles for Short-Term Trends = Negative
Combined Strength of Trend Score = +55
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Suggested REUTERS/JEFFERIES CRB COMMODITY INDEX Trading Instruments:
Non Leveraged ETF's: (Long CRBQ) (Short the ETF CRBQ)
Leveraged ETF's: (Long) (Short CMD)
Futures: Contracts are available to trade this market. Contact your broker
Options: Options Contracts are available to trade this market.Contact your broker
WARNING: Liquidity in some ETFs is very thin. Contact your broker for more information.

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IS PERSONAL MARKETCLUB COACHING RIGHT FOR YOU?
Free consultation. 877–219–1482
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HOW TO USE THE MARKETCLUB SCORING SYSTEM:
Chart Analysis Score: 50 - 65 Trading Range
Chart Analysis Score: 70 - 80 Emerging Trend
Chart Analysis Score: 85 - 100 Strong Trend
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This is Adam Hewison for MarketClub and I'll see you tomorrow, right here with my mid-day update. Have a great trading day.

All the best,
Adam Hewison
President INO.com and co-founder of MarketClub.com