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Today's Technical Outlook-6/01/2012

Market Summary

David Chojnacki S1F Market Technician

After a flat open, the Market quickly moved to the downside, as investors digested the morning economic reports. Disappointing GDP and Jobless Claims had the S&P average moving to test the 1300 level once again. The S&P bounced off a level just below 1300, but could not get back in the black by the close. At the close, the DJIA and S&P gave up 0.2%, and the Nasdaq100 dropping 0.49%. Breadth ended fairly even, on a pickup in volume to above average. RSI's remain in the mid to upper 30's, with ROC(10's) rising. The Nasdaq100 and S&P had their ROC(10) move into positive territory. This is a result of the averages flattening out after a steep decline. The DJIA and S&P developed 'dojis' in the session, which may indicate a reversal is looming. The S&P found resistance just above its150D-SMA(1318) and once again closed below. We are also below the 150D-SMA(12578) in the DJIA, giving us indication that the downward slide is not over. Near and short term bias remains to the downside. The DJIA now finds support at 12300 and 12250(200D-SMA). Upside resistance is at 12500 and 12578. The S&P remained below its 150D-SMA(1318) and tested the 1300 level intra-day. Near term support lies at 1300, 1291-95, and 1284(200D-SMA). Resistance to the upside remains at 1318 and 1320-25 area. The Nasdaq100 managed to hold its 150D-SMA(2503) once again and its MACD began to move above its signal. If we get a follow through on the MACD today, it may signal improving short term technicals. Support is now at 2512 and 2502. Look for resistance at 2525 and 2550. The VIX settled at 24.06, a slight drop, after being as high as 25.46 during the session. Employment Report is key today. Futures are significantly lower versus fair value in the early going.

Major Economic Reports Today

Employment Report-8:30am PCE Prices-8:30am ISM Index-10:00am Construction Spending-10:00am Auto/Truck Sales-2:00pm



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