Monday, June 21, 2010

Reversal day

Closing 3 points bellow Friday is not a big deal but this is not the whole story today. We did have a fake rally in the morning, touching 1131, then SPX ended almost 20 points down at 1113. The good news is that SMA200 did hold. The bad news is that price slipped bellow EMA50 on 30 minutes chart for the first time since June 10 at 1070.

This doesn't change the intermediate time frame trend that is still bullish, with SPX above a rising 5 days SMA and EMA50 crossing EMA100 on both 30 and 60 minutes charts. Daily DMI is still negative a little bit. When EMA50 does cross EMA100 on 30 minutes or even better on 60 minutes charts I use this kind of pullbacks as a buying opportunity. The problem here is that SPX doesn't have room to fell too much, SMA200 is around 1110 and a huge support/resistance level, 1100, not too far away.

I hope you are well hedged (see the article bellow for some hedging ideas).


"Time is a great teacher, but unfortunately it kills all its pupils ... - Louis Hector Berlioz"

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