S&P 500 futures...some perspective

200 dma = 1900.  Nice round number for all the programs to take us to on a Friday.

Resistance above @ the 150 dma and trend line:  1925.92

S&P 500 futures close right on 150 dma

I pointed out the 150 dma @ 1925 yesterday and we closed right on it.  Everyone's a technician when the market sells off and traders turn into market psychologists.

The easiest way to judge sentiment is to reference the charts.  Like a pilot flying blind in a storm, he relies on his instruments to guide him.  

During times of volatile, trendless tapes, the algos and the programs tend to play ping pong with the market in between these levels (9, 50, 100, 150, and 200 dma).

Earnings season starts tonight and will give us a clearer picture.

S&P 500 futures...some perspective

We failed this morning @ 1956, which happens to be both the 9 dma and the 100 dma.

Unless we can get above that 1956 level with a little volume and confidence, it looks like lower levels are in store.

1924.95 is the 150 dma and is sitting right on the long term trend line.

The 200 dma @ 1898 is begging for attention as well.

S&P 500 futures...some perspective

Perfect bounce off the trend line yesterday.  Now what?

A rally then roll over would hurt the most people, so that's what I'm leaning towards because the market is a nasty beast.

100 dma = 1954

9 dma = 1961

50 dma = 1969

These are all good levels to lighten up or even lay out shorts, in my opinion.

The 200 dma = 1897 and lurks below with a big bullseye on its head.

Moment of truth..S&P 500 futures right on trend line

COMP: Head and Shoulders if we fail at the 50 dma

This is 1 scenario that could play out.  If we get to the 50 dma @ 4224 and fail, that would be the right shoulder coinciding with the left shoulder that happened on 1/22/2014.  

If it happens at the end of this week, the "sell in May" crowd is going to be especially loud and this bearish pattern would help their argument.

Here's How Rich You'd Be If You Did The 'Sell In May And Go Away' Trade Since 1950

Walter Zimmerman, the top technical analyst at United-ICAP, charted the performance of a $10,000 investment in 1950 if you sold in May, and then bought back on November 1.

"The other half of the proverb is ‘Buy Back on Saint Crispin’s Day,’" said Zimmerman.  "That would be 25th October."

"This advice has shined the brightest in those years with the most extreme bullish sentiment going into May."

Check it out:

United-ICAP