S&P 500 June 2011 Technical Forecast - Wrong bull signal would Fail

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May 31, 2011 S&P 500 closed today at 1345.20 which is about 1.35% down compared to 1363.62 on the close of Apr 29, 2011. S&P is currently crossed its 50 days EMA of 1328.41 and 21 days EMA of 1333.97

With reference to my earlier update buckle up for wild swing and steep pullback, I have mentioned that do not trust this rally and we keep getting the bad news like home prices are going down.

June Forecast - Wrong bull signal would Fail?

Let's look the S&P technical levels in the following chart. S&P 500 is currently above 21 daysm 50 days and 200 days EMA. As technicals are still indicating the bull signal, It may try go higher but eventually it will have to come back to 200 days EMA of 1242.12.

If you are a long term conservative investors, then you have to switch your investment strategy and move on the Fixed Income Securities - Govt. Bonds, US Long dated Treasuries (TLT), US Dollar (UUP), etc.

If you are a long term risky player in the market, then you can initiate short position and accumulate short position gradually in the coming weeks. You can not expect return in the short term.

Only if you are day trader, you have to follow swing strategies. It is ok to bet on the volatility by betting either side (long and short) on the market.

Technical Indicators

10 Days EMA 1332.29
21 Days EMA 1333.97
50 Days EMA 1328.41
200 Days EMA 1242.12

Next Resistance Levels:

strong resistance level at: 1386.95 set on Mar 16, 2007
strong resistance level at: 1433.06 set on Aug 03, 2007
strong resistance level at: 1440.70 set on Nov 23, 2007
strong resistance level at: 1453.55 set on Sep 07, 2007
strong resistance level at: 1,530.23 set on May 30, 2007 (first closing high after dot com bubble)
strong resistance level at: 1,552.87 set on Mar 24, 2000 (all time high during dot com bubble)
strong resistance level at: 1,565.15 set on Oct 09, 2007 (all time high during housing buble before sub prime crisis)

Next Support Levels:

minor support level at 1328.41 - 50 Days EMA

strong support level at 1242.12 - 200 days EMA
strong support level at 1189.40 set on Nov 26, 2010
minor support level at 1064.59 set on Aug 27, 2010
strong support level at 1022.58 set on Jul 02, 2010
strong support level at 1036.18 set on Oct 30, 2009
strong support level at 946.21 set on Jun 12, 2009
strong support level at 827.37 set on Sep 27, 2002
strong support level at 683.38 set on Mar 06, 2009
strong support level at 638.73 set on Jul 19, 1996 - Might see this number again when completing double dip bottom