• SP 500 Market Analysis 6-01-13

Pre-market update (updated 9am eastern):

  • European markets are trading 0.1% higher.
  • Asian markets traded 1.7% lower.
  • US futures are moderately lower ahead of the bell. 

Economic reports due out (all times are eastern): PMI Manufacturing (8:58am), ISM Manufacturing Index (10am), Construction Spending (10am)

Technical Outlook (SPX):

  • SPX had one of the bigger pullbacks of the year on Friday, making the total pullback from intraday high-to-low equal to -3.3%. We’ve yet to see a pullback exceed more than 4% this year, so this is definitely significant  here. 
  • 1635 was a key support level for the short-term that was broken and now pushes price below previous consolidation. 
  • We’ve seen three pullbacks besides the current one since the November lows were established. All three had a moment where key support was broken, only for the SPX to bounce each time the following day and resume the upward climb. 
  • We are very close to being short-term oversold, which we haven’t seen since mid April. 
  • Each time we get oversold in the slightest bit, we have bounced hard and has marked the end of the pullback. We are at this point already. Let’s see if tradition holds. 
  • Volume was elevated on Friday. 
  • VIX spiked into the 16’s.
  • 30-minute chart on the SPX also is exhibiting a breakdown and out of previous consolidation. 
  • 1623 represents the rising trend-line off of the November lows. 
  • We finished May in positive territory for the seventh straight month. We haven’t seen that happen since the market market bottomed out in March of 2009. 
  • Markets don’t care about the economy. That is not what is driving them. The markets only care about what the Fed is doing to keep equities propped up. 

My Opinions & Trades:

  • No new positions added on Friday. 
  • May look to add a new position or two if the market can show me a decisive bounce today. 
  • Long HLIT at 6.08, HUM at $80.60, AMZN at $267.21, CF at $191.35, LUV at 14.25, APA at $84.95
  • Join me each day for all my real-time trades and alerts in the SharePlanner Splash Zone

Chart for SPX:

SP 500 Market Analysis 6-01-13

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