Morning Call: Futures Climb After ECB Refinancing Operation

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February 29, 2012 10:45am NASDAQ:QQQ NASDAQ:QQQQ

Round two of cheap money from the ECB took place with high demand, and futures are slightly higher as a result. The take up was around 529.5 Euros, a bit more than expected. Some this say this is a sign of weakness, but I think these banks are just

taking cheap money for 3 years to give them some extra insurance. (wouldn’t you?). Back in December I pointed to the first round and talked about its importance as The European QE.

Anyway, markets all closed above the big psychological barriers yesterday and now it’s important to see if we build a new floor above them. Each time we’ve stair stepped into new higher zones we seem to turn the previous resistance into a new floor.  If the trend continues, stay with the long side. Let’s see if we can do some work above the 1368-1370 S&P area. The 10day is 1360.

As we go higher, it does make it harder to stay with the rally, and it almost seems like for two weeks, the sexy thing to do is to call for correction. But this has not been the profitable approach. You don’t have to be heavy long up here, but there is no reason to be bitter and fight it. Until we get a clear close below the 10day moving average with some conviction—there is no reason to fight this trend.

At this point Know your time frame and Know you risk tolerance. Markets can trade down to the 50day moving average and still hold the Macro uptrend that started back on October 4th. Just figure out how you can manage your positions and approach (50day on the S&P is 1307).

It’s amazing how many Bears there are out there. I did a segment on CNBC yesterday giving some technical advice on how to stay with this rally in the short term, and where we can be three years from now. Based on some of the responses I received, there have been a lot of guys unsuccessfully trying to short this rally.  If you had to pick where we would be 3 years from now, up 300 handles from here or down 300 handles. Which would you choose? The answer is obvious to me. There will be a ton of trades along the way if you that’s what you do.  Everyone should tweak their portfolios at inflection points.

In stock specific news, First Solar (NASDAQ:FSLR) is down 7% this morning after missing EPS numbers and cutting sales forecasts for 2012. The solar sector had staged a brief rally in December-January, but it looks like the overall trend continues to be down in this sector with a murky future.

Here is yesterday’s appearance from Street Signs with Mandy Drury.

Scott Redler Scott Redler is the Chief Strategic Officer of T3 Live. He develops all trading strategiesfor the service and acts as the face of T3 Live. Mr. Redler focuses on thorough preparation and discipline as a trader. Scott Redler has been trading equities for more than 10 years and has more recently received widespread recognition from the financial community for his insightful, pragmatic approach. He began his career as a broker and venture capitalist where he was able to facilitate relationships that led him into trading. Beginning his trading career at Broadway Trading in 1999, Scott moved on with Marc Sperling to Sperling Enterprises, LLC after establishing himself as one of the best young traders in the firm. As a manager at Sperling Enterprises, he maintained his status as a top trader in the industry while working closely with all traders in the firm to dramatically increase performance. Scott has participated in more than 30 triathlons and one IronMan triathlon, exhibiting a work ethic that also defines his trading. His vast knowledge and meticulous attention to detail has led to regular appearances on CNBC, Fox Business and Bloomberg, and he has been quoted in the Wall StreetJournaland Investor’s Business Daily among other publications. Scott produces much of the media and content available to subscribers and followers. is an online financial media network and education platform that provides active traders and investors with market analysis, real-time access to strategies, and in-depth training from real traders, real-time.   This material is being provided to you for educational purposes only. No information presented constitutes a recommendation by T3 LIVE or its affiliates to buy, sell or hold any security, financial product or instrument discussed therein or to engage in any specific investment strategy. The content neither is, nor should be construed as, an offer, or a solicitation of an offer, to buy, sell, or hold any securities. You are fully responsible for any investment decisions you make. Such decisions should be based solely on your evaluation of your financial circumstances, investment objectives, risk tolerance and liquidity needs.Visit the T3Live Homepage, Virtual Trading Floor, and Learn More About Us.

*DISCLOSURES: Scott Redler is long (NYSEArca:SPY), (NYSEArca:OIH), (NYSEArca:GS), (NYSEArca:JPM), (NASDAQ:NUAN), (NYSEArca:IBM), (NASDAQ:CSCO), (NYSEArca:LVS). Short (NYSEArca:DIA), (NASDAQ:QQQ). Long (NYSEArca:SMP) puts.

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