Tuesday, May 23, 2006
Here is a 15 minute bar chart showing regular hours trading in the June S&P e-mini futures. I last commented on the S&P's here.
As you can see the market has stalled all day at the high of the last rally prior to yesterday's 1255.25 low. Generally speaking, a stall near an old high or low leads to a move in the opposite direction. This is what I think will happen here. My best guess is that the market is about to drop to 1261-2. After that level is reached I expect a third phase rally to 1285.
The entire 30 point move from 1255 to 1285 should in turn prove to be only the first phase of a larger, three phase rally which will halt near the 1300 level.