Pre-open eMini SP 500 Morning Report 3.22.10

This is a guest post from Precision Capital Management

The Precise Take – Equity futures to gap down into support

Leaders Analysis:  The US Dollar Index is up marginally overnight after rallying strongly the previous two days.  Though intraday it has been higher this year, it has yet to close above 80.85.  Accordingly, on the first test of this area in several weeks, it is unlikely to break through.  The EuroYen is hugging its 20 day moving average and 30 year T-Bond yields are at resistance.  All in all, the leaders are slightly equities bullish today; however, the overnight low in the EuroYen forex cross needs to hold intraday.

Medium Term Analysis:  With no scheduled news today, the markets will digest the health bill passed over the weekend.  This will be the first Monday since September 21, 2009 to materially gap down.  Last Monday began with a minor down gap and, after a flush of weak longs, closed the day strongly.  We could see a similar setup today.  Durable goods Wednesday will be a sneak peak of Friday’s GDP.  We would expect to see the bottom…

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