Now that the e-SPH has plunged into my optimal downside target zone at 1272-1270 for the expected completion of the correction off of the January 11 high at 1301, my work is telling me "NOT QUITE YET!" The index is pressing against very important support between 1270.25 and 1267, which represents (1) the 62% pullback area of the entire upleg from 1251.25 to 1301, and (2) the measured swing target zone within the corrective decline itself at 1267.50 to 1266.50. Judging from the ugly, negative juxtaposition of the hourly oscillators with the declining price structure, we have to be prepared for still more selling pressure in the lower target zone prior to the expectation of a significant upside pivot reversal.

MJP 01/20/06

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.