Monday, June 27, 2011

Market Recap 062711

We saw a strong bounce close to Friday's lows and attempted to break above Friday's highs but finished with an inside day. Today's weakness in the dollar allowed funds to kick-start their window dressing run as we saw names like MSFT and momo leaders put in strong runs. As many traders on the stream pointed out volume on today's up move was anemic so this rally remains suspect especially given quarter ending this week. ATR a measure of volatility continues to climb. The rally seemed to be fueled more from a lack of selling than from an overwhelming push to buy. Treasuries saw a sharp late day which at this point looks like traders still playing the range. On a technical note we're also seeing a lot of charts showing bullish MACD kisses or crosses.

I expect us to continue to trade within the 126-130 SPY range for the rest of the week. It may be possible for us to get above the 20 SMA but I'm not anticipating that at this point. I still think the dollar sees 75 before 77 so my bias is bullish risk assets. There is always headline risk with the Greece situation still fluid, Chinese PMI on Thursday,etc... that can cause a sudden sell-off but I expect any breakdown to fail. As always trade what you see and be prepared for anything.

This week's econ calendar:


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DX_F 30 minute

Copper (HG_F)

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TLT 30 minute



McClellan Oscillator



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