Bulls hold off the bears as bonds keep dropping and the yield on the ten year jumps to 3.92%, almost negating the head and shoulder we were building over the past week. Much of the enthusiasm was based on the rather dubious possibility of a housing rebound. We all now this is the start of peak season for home buyers and sellers, so an uptick is to be expected. Let's hope it does improve some more, but I'm not holding my breath.
The drop in crude was also mentioned by the media, but we are still holding 10 dma support and 38.2% projection April (chart), so the jury is still out as far as calling tops. Uptrend support is all the way down at 115, the 50 dma and trendline. Even if we correct that far, the primary trend is still up. And it would still be +110 oil, folks.
The COMP did close above the 20 dma and that is the most positive development. It will need to hold as support going forward (2473). The problem is that ES / SPX is still within a bear flag with 5 dma resistance.
Since Monday was a holiday, will reversal Tuesday actually be a Wednesday this week? Oil inventories will be moved up a day to Thursday, so we are in for some price swings.
This entry was posted
on Tuesday, May 27, 2008 at 5/27/2008 06:24:00 PM.
You can skip to the end and leave a response.
» Post a Comment