More Range This Month?
Dow Jones
S&P500Looking at Trends, S/Rs, PHIbs and Candles on weekly and monthly charts, it would seem like we’ll range even more this week. The “summer rally” of June is traditionally the worst rally of all four seasons but great enough for short term traders.
NASDAQ usually has a good June especially during the End Of Quarter Window Dressing. The first trading day of June is more often than not, bullish so tech buyers should watch for entries.
June expiration also brings on the Triple Witch (20 June) which adds to the summer rally sentiment. But beware the day before the TripWitch (19 June) as it is traditionally very bearish as is the day after the Trip Witch (23 June). Statistically, the week after the TripWitch is reliably bearish with the worst saved for the last day of the month.
But we can look forward to a bullish start to June today, with the 1st-day-of-the-month trading day phenomenon, where on the DOW Jones over the last ten years, the 1st trading day of the month has combined gains which outpaced all other combined trading days.
We should be having some fun this month as I expect DOW to range between 13,135 and 12,010. Where will it close? Frankly, I don’t care but for the sake of discussion … 12,200 is a likely support. S&P500 will likely find its June bottom at 1,320 and a top at 1,440.
Sector strength will likely continue amongst Construction (FLR, FWLT, JEC) & Const’ Equipment (MTW, BUCY, DE) and HMOs (HUM, AET, CVH, MOH) while we can shop for quick opportunities with Agri (MON, MOS, CF), Industrial Transportation (UNP, BNI, CSX, CNI, CP, NSC, CHRW, JBHT, R) and Shipping stocks (VLCCF, EGLE, DRYS, DSX, FRO).
As always, trade with caution and don’t hold on to your profits for too long. Tempting Mr Market to take it away is always ill advised.
Happy Hunting!!
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