Weekend Report for Monday, June 3

Bottom Line:

From last weekend’s Update:

“Things always clear up.”

While there are still some questions (when are there not) about the short term path of the market, Friday’s trade puts the probabilities on the side that that we will soon see new highs in the SPX and/or NDX.  

All the primary US trading indices had a dramatic rally that accelerated from 3:30 PM into the close, forming “V” bottoms and leaving buying tails on the charts.

If the late rally and closes on the highs is as bullish as it appears to be, any retracement prior to new highs in the SPX and/or NDX should be shallow and short lived. A good guideline is the 50% retracement of Friday’s range as a maximum we should see under an immediately bullish assumption.  

PDF: Weekend Report_2024_06_02

VIDEO: https://youtu.be/xCq7v7W3jIk

SPX

Upper KRA: 5342
Lower KRA: 5337; 5191

The SPX is .85% from another all-time closing high. 5337, the 50% retracement of Friday’s range, is the immediate important downside level to watch.

NDX

Upper KRA: 18904
Lower KRA: 18387; 18190

The SPX is 1.80% from another all-time closing high. 18387, the 50% retracement of Friday’s range, is the immediate important downside level to watch.

DOW

Upper KRA: ?
Lower KRA: 38417; 38006

The DOW was in a mini crash. It is not going directly to new highs and determining where it may pause even if it is going to new all-time highs is a complete guess

RUT

Upper KRA: 2113
Lower KRA: 2060; 2046

The RUT is noisey but holding up relatively well.

 New York Composite

Upper KRA: 18425
Lower KRA: 17969; 17843

SPX Profile 

From last weekend’s Update:

Daily Profiles (Auctions)

The SPX has gone net nowhere for the past eight trading days, with a net change of -3.45 points. Day-to-day VALUE is trendless.

Market Profile has been hi-jacked by the twitter/guru crowd. It is best used in context to help determine market condition. It is not ALWAYS helpful; it is NOT MAGIC.

The last couple of weeks is one of the times it has been really helpful in identifying market condition. We saw the inevitable sharp break from Balance that began on Wednesday culminating in Friday’s low.

Now, we have an upper level that should be closely watched on any continuation early next week of the rally that started at Friday’s low. 5310 would close a gap from 5/29 and is also almost exactly the apex of the HVN (High Volume Node) of the composite Auction structure of 5/15-5/28.

Internals

The 10-day MA of NYSE advancing issues dipped to a level from where significant rallies have begun over the past few years.

The caveat is that this level is not as much of a “lock” for a potential low as the next level lower that is highlighted on the chart, but we certainly should be aware of the possibility of further rally in the immediate future.

US 10-yr Notes

Notes are in a long-term downtrend – choppy but clearly making lower lows and highs.

US Dollar

The Dollar is mired in a choppy range. 

Gold 

No change: Gold made a double top last Monday. A test of 2283.40 looks likely.

Crude

No change: Crude is trading in a downside KRA. Expect a sharp move away from this area soon. The current trend is down.