Wednesday, May 31, 2006

S&P Update

Here is an updated 15 minute bar chart showing regular hours trading in the June S&P e-mini futures. I commented on this chart this morning.

I thought the S&P's would continue upward to 1275 but in the event the market could only reach 1272 which I take to be a sign of weakness. After the release of the Fed minutes the market broke sharply on very high volume. The subsequent recovery occurred on substantially diminished volume. This too is a clue that prices are headed lower. My short term downside target remains 1250. After that level is reached I think a move to 1295 will begin and be the final phase of the rally from last week's 1246 low.

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