Monday, May 16, 2011

A pop above 39.565 is still needed to rejuvenate the intraday charts, but we'd settle for a mere 36.930 by tomorrow to start the ball rolling again for bulls That's a tick above the look-to-the-left peak shown in the chart, but if the futures cannot muster the energy to get there, a 31.205 downside target broached here earlier -- the Hidden Pivot midpoint of an even larger corrective pattern -- will remain as a minimum bearish objective. More immediately, the July contract was  looking a little tired Sunday night. But if the mood changes dramatically enough to push the futures above a midpoint resistance at 36.415, a 'D' target at 38.275 would be in play.

A 1470.10 minimum correction target that lies 7.50 beneath last week's low remains in force, but if it's exceeded on a closing basis or by more than 1.50 points intraday, brace for more downside to its Hidden Pivot sibling, 1413.50. Alternatively, it would take an upthrust exceeding 1529.30 to produce a glimmer of light for bulls, and nothing less than 1543.60 to turn the hourly chart bullish. Both price points are highlighted in the chart.

Although today's E-Mini S&P forecast predicts lower prices, a cursory look at the Dow's hourly chart obliges us to give the begrudging benefit of the doubt to bulls, since almost no technical damage has resulted from the scuddling price action of the last two weeks. Bulls would regain control on a thrust today exceeding 12810, but otherwise we should presume the correction has at least a little ways to go, to a minimum 12461, or possibly to 12427 if any lower.

The June contract would need to close above the 1.2543 midpoint of the pattern shown to resume the bull move begun in late April from 1.2074. More immediately, the minor trend is bearish and projects to the 1.2265 target shown.