S&P for 6/1/2010

Big price swings are a traders dream. This week I'm looking for the S&P to trade between 1047 and 1117. I still feel the S&P will go down to the Year Pivot Point at 1019 and test it, in June. The Monthly S1 pivot is at 1017, so there is a confluence of pivots points down there, which means strong support, because professional traders in the pit use pivots.

Looking for an End of Month rally

I'm looking for the markets to rally the next several days, as we have end of month window dressing and next week is a new month with new 401K money being put to work. I'm looking for a bounce the 200dma(10275) and maybe the 20dma(10550 +/-).

Buy signal negated overnight

The Dow futures broke 10040 overnight and negated the short term buy signal. As I write this, the futures are down 200 pts. in pre market. Next support is at 9622. There is the weekly s1 Pivot at 9800 that may hold today. We are also testing the February lows. We are very oversold and due for a bounce. The 2010 Bradley Model I've written about, shows a fast deep decline into August 10th. The 2010 model goes down to it's lowest reading in 80 years(when the great depression started). Dow 9000(monthly 200 moving average), is the 50% Fibonacci retracement off the March 2009 low. It's going to be a long UGLY summer for equities.

Pivot Power

Here is a great example of how powerful Pivots Points are. The NDX futures high in April was at the Yearly R1 Pivot(blue circle on the top of the chart on the purple line marked R1). Then it fell fast and hard to the the Monthly S4 Pivot(bottom of chart blue arrow on green line S4). Using a combination of different Pivot Points(yearly, monthly, weekly), my charts show me where the best odds are for market tops and bottoms......... Support and Resistance. This is PIVOT POWER! This is the best tool for trading!

Dow Jones Yearly R2 (YR2) to Yearly Pivot(YPP)

The Dow Jones Futures on the chart above, went from a high last month at the Yearly R2 Pivot, then down to the Yearly Pivot Point last Friday. Pivots show me where to look for market tops and bottoms. Support and Resistance! Now I am seeing a buy signal on the Yearly Pivot at 10040(purple line marked P). The Dow needs to close above 10040 or I will be wrong. I think we bounce back up to 10500 - 10800, and then another crash! We could rally into June 4th. If we break 10040 then next support comes in at 9622 below. Get use to BIG WILD PRICE SWING action. It's just getting started! It is going to be an ugly summer in the stock market. Make sure you have protection on ALL long positions or raise cash on rally's.

short term Buy Signal

It's almost 12 noon EST on Friday and the indexes went down to their 50 week(daily 250) moving averages and are bouncing off them. If we close in the green today, it will give a buy signal short term. Maybe 4-6%.

Weekly 50 next major support?

I'm watching the weekly 50dma(daily 250dma) for support and a short term buy signal.

Dow Jones= 9935

S&P= 1068

NDX=1750

Targets using Pivot analysis

The S&P and NDX June Futures high for 2010 so far is the Yearly R1 Pivot(blue circle). Now we should go down and test support at the Yearly Pivot Point at 1019(purple line and blue arrow). Using Pivot Point analysis, I'm looking for the S&P June futures, to test the YPP(yearly pivot point) by the June Expiration on 6/18. On the NDX June futures, look for a test/support @1680.

Silver and oil

Silver(salmon color line) on the chart above, has been following oil for the past several years. Now that Oil(green color line) has fallen hard, will silver fall hard soon too?

Crude oil yearly pivots

July crude oil futures hit the Yearly R1 Pivot(see arrow and purple marked R1) and now I'm looking for the Yearly S1 Pivot(blue circle at purple line marked S1) at $70.50 for support on the July contract. PIVOT POWER!

Gold futures are close to Yearly R1

Gold last week made new all time highs. The June futures contracts are getting close to the Yearly R1 Pivot @$1261(purple line marked R1). On a continuous chart Yearly R1 Pivot is $1282. Longs be careful up here and maybe book some profits at the YR1 pivot.

watching the 200dma for support

Last week I said, to look for a retest of the 50dma and that's exactly what the S&P, Dow Jones and Nasdaq did. This week I'm looking for the 200dma at 1090. Resistance comes in above at 1145 and then at 1173.

Crude oil on Yearly PP

June oil futures keeps bouncing of the Yearly Pivot(purple line marked P) at $75.35. Good risk/reward there for a long.

Natty yearly S2 pivot holds again

June Natgas futures keeps finding buyers(support), on the yearly S2 pivot(purple line marked S2). I still think the low for natty is in for 2010. I'll be wrong with a close below YS2.

back in the buy zone

The percent of stocks trading above their 40dma has dropped to 15%. Now we are back into the buy zone. I'm looking for the S&P to trade between the 50dma(1170) and 200dma(1090). This will only be a short term buy, as the market has made a major trend change that will last through August 10th, 2010. I'm expercting more downside through the summer.

it's not over

Yesterday's 1000 pt. sell off is a warning of how manipulated the stock market is. If 1 person or a bunch of super computers can cause this, why will people want to invest? Even though most of yesterdays sell off trade's where negated, I don't see this as a long term buying opp. I think we will consolidate and maybe retest the 50dma, before falling again. I think 10,000 on the Dow and 1050 on the S&P needs to be retested. "Come May and go away" maybe the best strategy this summer.

10% correction started?

In 1980, 1990, and in 2000, all those years that ended with a zero "0", there was a 10%+ mid year correction. I believe we are seeing the beginning of 2010's mid year correction. We tested the 50dma(1168) today, per my call a few days ago. A close below the 50dma(1168 on the S&P), will spell trouble down to the 150dma (1110).

I've been writing about some warning signs the past few weeks.

1) in the "danger zone" with 80%+ of stocks trading above their 50 dma.

2) June Index futures contracts, all at the Yearly R1 or R2 pivots.

3) the 61.8% Fibonacci re-tracement area...aka the "Ambush Zone".

4) Big price swings ie: we had 5 days of triple digit up/down days very close to each other = topping action.

These warning signals told us NOT to look for new long positions, but to start raising cash. Professional traders buy support and sell resistance. We hit major resistance at the Yearly R Pivots!

Is the rally over? yes, the big down volume is telling us the smart/big money is pulling out. They maybe be back buying in a couple of days, weeks or months.

Topping action

Last week, the S&P is showing signs of topping action, and a Head and Shoulders top at YR1(blue circles) I still think we will see a pullback to 1168 this week.