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Pre-Market, 4 June 2009

The market is hanging right at the 200 Day EMA. Yesterday (3 June) for most of the day, it looked like that average would act as resistance and the market would head lower in the range it has established the previous two months, down to 875. But, in the last half hour, the market recovered half its losses for the day. We all know that the last hour is the most important time of the day and shows the psychology of the market best.

Today, on really lukewarm unemployment claim news, the pre-market got stronger. Art Cashin, who has been calling for a correction the past two weeks, admitted just now that the market SHOULD go lower, but WANTS to go higher. He is looking today to see if the market heads higher off the 200 D, as he thinks it might. Any excuse for a good news will result in a market surge. Tomorrow's unemployment report will be the excuse. Consensus expectations are for 550K job losses. If the market comes in at 525K, that will be reason for a surge.

Still, the market needs a correction and sometime, probably when least expected, it will come. So, I am keeping my hedges (covered calls) on.

Disclosure: No Positions