$TLT 124.50, if we all jump at once maybe? Study

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Asia – CLOSED
• Shanghai (China) +0.14%
• Hang Seng (Hong Kong) +1.51%
• Nikkei (Japan)+0.70%

Europe as of 6:33am EDT

• DAX (Germany) +0.69%
• FTSE (UK) +0.24%

Today's Economic News:

Quote of the day:
We are confronted with insurmountable opportunities. – Walt Kelly

Current Breadth Readings:

For today we look at our Zweig Breadth indicator that is once again, for the second time since the low,  overbought.  However, it is a healthily overbought.  If we can get the NH/NL indicator to ripple, we would see volatility really die in the markets and begin a summer slow grind up rally that would befuddle the bulls.  We are watching closely for divergences that will tell us that we can not hold these levels.  Our number one concern is TLT.

ES SP500 Futures Comments:

Short Area: 1369

Long Area: 1335 (although we like 1340/43 also!)

An impressive hold for the bulls who are still looking for extension to the upside and the overnight did not make that happen.   A correction down to 1340 would be an interesting spot to evaluate a long entry, although we feel a two day sell off to 1335 would be more interesting.  Today is pre-fourth, the volume will be light, and the markets will have crazy schedules and close early and the day will cause havoc to all us technical analysts.

If the market does get out of control today and rallies to the 1370 area, that would be a short, and we would wait for some relaxation to come in by Friday or early next week.  Overall, the markets remain bullish and the breadth is not showing any signs of weakness except for stretched overbought conditions.. and we know what that means.. the bears will be shorting like crazy, adding fuel to the upside if the balance of power tips that way.

US Dollar DX Futures Comments:

Our dollar is putting in a little bear flag here over the last two days.  We are waiting for a break below 81.50 or a confirmation of a lower high above 83.25.   Since we think breadth is telling us the markets want to rally some more, we think the dollar needs to go down to make that happen.

TLT Twenty Year Bond EFT Comments:

Grrrrrrrrrr. Grrrrrrrrrr.   TLT is the bulls' party pooper.  It killed the last rally attempt and is putting a dent here, creating headwinds that are going to be difficult to overcome.     That 124.50 area needs to give way in order to spur the hidden money into higher risk.  Come on 123, let's see some fireworks!

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