11,900 Dow Cash brings us to 12,200 but it could be short lived

  • Posted on: June 21, 2011

300 pts is just a drop in the bucket, but its a good bounce none the less. There is a trend line above us with an intersection at 12,350. Use 12,350 as a target to liquidate 2/3 of the long positions hopefully you have been holding for the past 4 trading sessions. 12,400, which had been old resistance should come into play once again.
12,250 and 12,369 are both good sale areas. If we happen to bounce back to the 12,484 level that is where I would get out of all longs and then flip short.

Maintain sell stops below current longs to insure profits remain profits.

12,98 in S&P Cash as well as 1312 should provide good upside targets in the broader index if you are trading that as well.

It really looks like we will have wide trading range through the rest of the Summer.

Greece, whose economy is smaller than that of Dallas/Ft Worth, will be eventually dealt with. Perhaps its the unfolding of the euro or the beginning of the unfolding of the euro.

Time will tell. For thousands of years Europe couldn’t get a long. What made these politicians think that in less than a decade they would be able to reverse all those years of bickering, competitiveness amongst those nations.

Of course, I could be wrong. Its just my opinion. And guessing the direction of the people can be a dangerous bit of speculation.

As for crude, we may get a bounce here but I think its a bounce to be sold. A move back to 100 can’t be ruled out, but I think crude will have a very hard time getting there. There is a lot of resistance between 95 and 98 on the charts.

After a dollar break, and a small bounce, I like being long corn going into the June 30th USDA final acres report. So, Lets be clear, since in about ten days the market will give us a report card. I want to be long corn with a ten cent sell stop below current levels. Do not risk any more than 10 cents at this point with a corn long position. There is 65 cents of upside potential. That’s a 6.5:1 risk reward, and I like those odds.

I really like stepping in here and buying 1 year lows in the wheat. Again, do not risk more than 10-15 cents on this idea. Wheat could very easily roll over and head for the morgue. However, we’ve had a almost a 2 dollar break in less than 3 weeks.
You have to fade the herd, and that means buying it here.

Like always though, have your parachute set to deploy automatically to avoid bouncing.

That is All
CER