Pre-open eMini SP 500 Morning Report 5.26.10

This is a guest post from Precision Capital Management

The Precise Take – Equities futures up as fear dissipates slightly

Big Picture Analysis:  After yesterday’s recovery from the overnight decline, it looks like the bulls are going to attempt a short squeeze centered around the upcoming three day weekend, not dissimilar from US President’s Day in mid February.  From a Market Profile perspective, the first hurdle is to accept in the next higher value area (deep purple, below), above 1101.50.  The last attempt to accept in a higher value area was on May 18, which failed and led to a large selloff intraday.  1101.50 is also resistance from the upper end of the downward sloping trend channel.  If a short covering rally ensues, it will likely be short lived, but could manage to reach the 50 day moving average at about 1160.  If the ES rejects the next higher value area…

Read the whole report here:

http://www.precisioncapmgt.com/wp-content/uploads/Precision_Report_May_26_10.pdf