Pre-open eMini SP 500 Morning Report 6.2.10

This is a guest post from Precision Capital Management

The Precise Take – All eyes on the Euro as equities continue to attempt a rally

Big Picture Analysis:  It was on the sixth trading day after the February 5 hammer low that there was a follow through day, leading many to believe the worst was behind.  Preceding such, there was a pattern of higher highs and lower lows, with a well developed lower trend line.  Today is the sixth day following the May 25 hammer low and, while there is still the semblance of a lower trend line that has yet to be invalidated, skepticism regarding the prospects for a rally increases daily.   The first hurdle is the confluence of the 20 and 200 day moving averages around the bottom of the next higher (purple) value area that was rejected on May 28, around ~1102.  A close below the current value area (red) of 1061.75 is bearish and probably kill any rally prospects.

Leaders Analysis:  The US Dollar Index has formed a consolidating wedge with three rejections of the ~87.50 resistance level, the latest as of yesterday.  Many have commented on the ECB intervention in the Euro currency and…

Read the whole report here:

http://www.precisioncapmgt.com/wp-content/uploads/Precision_Report_June_2_10.pdf

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