We may be nearing the bottom of our trading ranges in the Stock indexes for the Summer.
12,215 is the mid point of our recent 1325 trading range. The low of that range was put in Mid March 2011. The high we pierced just 6 weeks ago on May 2nd.
I like the following support levels in Dow Cash and S&P Cash.
Dow Cash: 11,860, 11,777 and then the March low at 11,555.
S&P Cash: 1262, 1251 and the March low at 1241. If the bears really get going, 1225 is a buy.
My opinion, for what its worth, the Stock indexes are going to be range bound through this next election cycle, barring a disaster in Greece or the rest of Europe with defaults.
What does the range look like: 1240-1350 in the S&P, 12,500 -11,000 in the Dow.
Those are wide ranges, but that is what the charts are telling us.
One quick note, I have been patiently looking for something worthwhile to do in Gold or Silver. In gold, I like a major long term trend line support bull trend line. It has been tested at least 6 times in the past 4 months.
Go to the Jan low at 1309..hit the march 15th low at 1380 the march 17th low at 1386, the May 5th low at 1462, and Today’s low for the trading day so far, 1524. Initiate trades based on where we trade on this trend line. Buy it here, with a sell stop. Risk 10 to 15 dollars, with an upside target to sell at 1555.
I am still short my Dow position, however I have protective buy stops above.
The crude oil trade looks mired, especially after the Saudis decided to forgo OPEC and raise their production. It’s no secret that 100 dollar oil is a fulcrum. Its a nice round number, its politically easy for folks to understand and get angry about, Back in March of 2009 when oil was at 34, no one cared about oil company profits.. Supply issues drive up price, and suddenly its time to punish those same companies.
There is a gap down at 90-88 which needs to be filled. If crude can move below 95.00 a barrel in a meaningful way, we should run down there and fill that gap.
Other wise, we will sit in a 10.00 trading range between 95 and 105.
Good Trading.
Use your stops.
Don’t get stubborn.
CER