The weekly chart of the SP 500 has a possible head and shoulder pattern forming. Price traded down to the lower end of the neckline. This is an important suppport area to keep an eye on. I have put the Fibonacci retracements from the March 2009 lows to the recent highs.
The head and shoulder pattern is confirmed if there is a decisive close on the weekly chart below the neckline.

The SP 500 broke the 1101 support area. There had been several previous tests of this area. When you are monitoring a support or resistance area you can usually find a counter trend play on the first, possiblly second test. After that you want to be aware of other market conditions that may lead to a break of that area.

If we use the “what once was support is now resistance and what was once resistance is now support theory”, the breaks of these areas can lead to trading opportunties. Today we will be watching for a shorting opportunity on a test at or near the 1101 area.
Have a great trading day.
Leslie
www.tradingliveonline.com

The Narrow Range Day from Friday led to range expansion; Friday’s range was 7.75 and yesterdays range was 24.25. The SP 500 Emini had a trend day down after a large gap up open. We want to watch the 1100 - 1101 area, that is an area of support. It was previously an area of resistance and market had an upside breakout above it. It was tested the middle of June and so far has held as support.
Another area to note is the highs made yesterday in the regular session were at the .50 retracement.
Today starts a 2 day FOMC meeting, will look for range trading today.

A few things to watch for today. The futures are up in globex due to news related devaluation of the Yaun. Friday had a narrow range day, meaning that price is in a contracting phase, expansion follows contraction. Seeing the expansion in globex and the large gap up open today could lead to trend type trading for the day. Watching the first hour range can helpful for this.
Another contracting type condition is that the SP 500 emini closed around the same open area for 3 days, this also can lead to trendy conditions. With a large gap open watch how price reacts to the gap and the support and resistance areas and watch for signs of trend. Best to trade in direction of the trend. Have a great trading day.
Leslie - www.tradingliveonline.com

SP found resistance in yesterdays trading at the 1117 - 1118 area which was a .618 retracement and also a 127 extension pattern that completed in globex yesterday. The low of the day was 1100.75 and held the support area.

This area was previous resistance and had an upside breaout earlier this week. Tests have now been made to this support area and will be an important support area to watch.

Still some resistance above the 1117-1118 area around 1125 to keep an eye on.

There is an FOMC 2 day meeting next week to also keep an eye on.

Have a great trading day!

SP 500 Emini traded up to the .618 retracement area at the 1116 - 1117 area. Price traded to that area in globex and completed a 127 sell pattern. Will be watching today to see how that area holds.

Trading Live Online, LLC will be hosting a free webcast tonight presented by Bennett McDowell of TradersCoach.com, “Money Management Formulas that Help You Secure Profits”.

Starts at 5:30 PM PDT (8:30 PM EST)

Money Management is key to successful trading, come join us for this webcast to learn more for your trading.
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Last week the Chinese Ministry of Finance was unable to sell all of its planned issuance of 91- and 273- day bills. This is really a wake up call for governments not focusing enough on their debt. Now rumors are swirling that Chinese bond vigilantes are officially on the move. This begs the question…is the U.S. next? The United state’s debt to GDP is roughly 92% which is really not all that far behind the PIIGS. Locking up money for 30 years with historically low interest rates of 4% is not exactly a strong long term plan. Technically the daily chart of the 30-years Bond futures shows a “Butterfly Pattern” forming at these current lofty levels. Traders should know that Bond futures move inverse to interest rates. So if interest rates begin to climb, bond future prices will crumble. The Butterfly can be a major reversal pattern….as it was when the pattern formed at the lows of the S&P’s in March of 2009. This set up could come into play in the next few weeks. For more information on the buttlerfly visit our website at http://www.tradingliveonline.com

Kevin Riordan

If anyone is going to be at the Los Angeles Traders Expo I will be giving a complimentary one hour presentation on the AB=CD/Gartley pattern on Thursday June 10 at 8 am - 9 am.

I hope to see you there!

Leslie Jouflas
www.tradingliveonline.com