With oil prices under pressure and possibly headed to the mid-to-low 50's, perhaps the retail sector is on the verge of a serious uplift heading into the holiday season? Purely from a technical perspective, if the RTH can hurdle resistance in the 95-95.50 area, then expect upside acceleration to 97.00, which represents the 50% recovery level of the prior downmove, from the August high near 104 to the 90 low in October.  A sustained hurdle of 97 will be extremely bullish, and will point to a run at 102-104. At this juncture, only a reversal of today's strength that breaks 93.50 will weaken the improving outlook. The heaviest weighting of components of the RTH are WMT at 18.8% and the HD at 17.42%, both of which have very constructive chart patterns.

MJP 11/02/05

Mike Paulenoff is a 25-year veteran of the financial markets and author of MPTrader.com, a real-time diary of his E-mini S&P and QQQQ technical analysis and trading alerts. For more of Mike Paulenoff, sign up for a FREE 30-Day Trial to his E-Mini/Index Futures diary, or try his QQQ Trading Diary.