Tuesday, May 24, 2011

Resistance points

We had some initial juice in the market with the USD weak and commodities catching a bid on the Goldman upgrade.    However, not too many charts will set-up long until bulls take it up a notch and get it over the following resistance areas:
SPY reversed again on the 50SMA.    A close over would be bullish short-term.   If bulls can’t get it going most likely bears will press their bets.   Inflection point.
Semis barely holding onto 100 SMA — they were holding well until recently and need to pick-up on support in order to keep the bull thesis alive.

XLF rejected again at the 200SMA today — horrible action here but at least would look like temporary bottom on a close above.

QQQ can’t get above 100SMA — again note how traders sold the 100SMA test.

IWM reversed again at 82 resistance.     We should get a distancing from this area soon as bulls/bears press their positions.

As you can see from the above charts we’re at a very important point in the market (short-term).  Both bulls and bears will try hard to press their bets at these inflection points.   We have very few set-ups either way — however we expect that to change quickly once the victor emerges.
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