SPX S/R Week of 6/4/12

SPX support, resistance, moving averages and other important levels are highlighted below. The SPX closed within a point of the low on Friday. Two key levels gave way to the downside on Friday.  The 12-month MA failed indicating that markets have now fallen into an extended bear market. Price further collapses falling thru the 200-day MA creating more technical damage. Note the strong support at 1277-1278.  The non-bold numbers are strong S/R. The bold numbers are very strong S/R.  The bolded and underlined numbers are uber strong support and resistance levels. Price movement thru these uber levels is very important and identfies strong trending moves in that direction. Note that Friday's price action punched down thru 1278 but could not move thru this strong 1277-1278 gauntlet, at least not yet. This gauntlet of support is key to begin the new trading week.

The 12-month MA and 200-day MA's are key levels to lose and typically a back kiss would be expected for price to confirm direction.  For the SPX on Monday starting at 1278, the bears only need to punch down thru the 1277-1278 gauntlet and a waterfall slide will be in progress to 1268 and likely 1258. The bulls need to recover Friday's losses to reignite the upside, a formidable task, so instead the bulls will simply try to stop the bleeding by making sure the 1277-1278 support holds while moving price back up thru the 200-day and 50-week moving averages and attack the 1285 resistance. A move thru 1278-1308 is sideways action.

Hang on to your socks. These are epic history-making markets in progresss. The fun will ramp up with the futures and Asian markets on Sunday evening. Europe will open next at 3 AM EST after which the European bond rates and France-Germany spread can be studied. Then, of course, the U.S. equity markets open 9:30 AM EST Monday morning. Watch the 1277-1285 range identified by the uber strong numbers below. The side that price exits this range will be important dictating a larger move in that direction.

·         1336

·         1333

·         1332

·         1331

·         20-day MA 1329.32

·         1329

·         1326

·         1321

·         1319

·         150-day MA 1318.84 (150-Day Slope is One of Keystone’s Secular Signals)

·         1318

·         1316

·         1315

·         1314

·         1312

·         10-day MA 1311.93

·         1310

·         Friday HOD 1309.87

·         1308

·         1307

·         1305

·         1300

·         1298

·         10-month MA 1296.21

·         1296

·         1295

·         1293 (10/27/11 Intraday High 1292.66)

·         1292

·         12-month MA 1289.44 (One of Keystone’s Major Secular Signals)

·         1289

·         1287

·         1286

·         1285

·         200-day MA 1284.53

·         50-week MA 1283.20

·         1281

·         Friday Close 1278.04

·         1278

·         Friday LOD 1277.25

·         1277

·         1275

·         1272

·         1270

·         1268

·         1267

·         1265

·         1261

·         1258 (1257.64 start of 2011; 1257.60 start of 2012)

·         1257 (3/16/11)

·         1255

·         1252 (9/14/08 pre-LEH bk)

·         1249 (LOD 3/16/11; failure at this level 8/4/11)

·         1247

·         1244

·         1242

·         1240

·         1238

·         1235 (12/15/10; HOD 12/7/10 large volume)

·         1233 (LOD 12/16/10)

·         1229