Wednesday, June 20, 2012

Morning Market Analysis; US Markets Resurgent?

The 60 minute SPY chart (top chart), shows resistance around the 133 area.  Prices moved through that level three days ago and have been rallying since.  The daily chart (lower chart) shows that prices are now above the EMAs, and that the 10 and 20 day EMAs are moving higher.  I would expect a small amount of profit taking to send prices a bit lower from here, probably to the 50% fib level or the 50 day EMA.

The dollar continues to move lower; it has now reached support at levels established in mid-march of last year.  Prices are now in the "sweet spot" of Fibonacci levels from the May rally.  The EMA picture is weakening, with the 10 and 20 day EMAs moving lower.  Finally notice that momentum and volume are weakening as well.

The weekly oil chart is interesting.  Prices are below the 200 week EMA and the Fib level from the mid-2011 to early 2012 rally.  However, prices appear to be stabilizing right below the 200 week EMA.  Also note the slightly positive reading in the CMF (just barely positive, mind you).  It appears that prices are attempting to stabilize around the 85 level.

The daily chart shows that oil prices are consolidating in the 82.5-85 area.  A move about 86 would probably be a good time to go long for a short trade.