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S&P Futures Head for Another Breakout 5/28/21

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The ES S&P fucutures have been attacking resistance at 4210 throughout the night and into mid day here in Europe, early AM in the US. They look poised for a breakout. That would make the next target the rising channel line running 4230-4235 over the next few hours. 

tvc_805172b9a495dd365e0fe9eb3821c853.png

 

They just need to clear 3218 to head for a 2-3 day cycle projection of 4228. The 5 day cycle projection is in flux but could be as high as 4238, which would be a test of the high. Trend resistance is around 4220 at 6 AM ET, rising to around 4228 at 3 PM. Clearing that would launch them toward a full attack on the highs. 

 Cycle indicators are mostly moving sideways in positive territory. That supports continuation of the uptrend. 

There are multiple sport lines every few points down to around 4178.At a minimum, need to break 3205 to get anything started on the downside. 

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Meanwhile, 

Stock Market Meat Grinder Running in an Uptrend

 

The Meat Grinder Prevails – Swing Trade Picks For Week of May 24, 2021

 

LEE'S FREE THINKING

About the Reverse Repo (RRP) “Crisis”

by Lee Adler •  • 0 Comments

Zero Hedge, in its inimitable, breathless, and incomprehensible fashion referred to a looming crisis in the Fed’s Reverse Repo program.

This is an important issue, but there’s a lot of confusion around it, so I want to try to explain exactly what’s going on and why it’s not a crisis now, but is a mirror on a process that will lead to one. We know exactly why, and we know when.

Banking System Fragile As Fuse For Implosion Nears Ignition

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Bulls won the screens yesterday with 45 swing trade buy signals and 14 sell signals, a spread of +31.  That compares with 22 buys to 8 sells, or +14, on Wednesday. Back on May 14 we had a surge of 153 buy signals to 6 sells.  The reduction in the total number of signals is because there have been so many buy signals in the past two weeks that there are few left to trigger. And there's no new wave of sell signals yet.  So we're still in the residual momentum stage of the surge on May 14.

That suggested a new bull swing phase. It hasn't really materialized yet. It keeps trying, but doesn't quite get there. 

The 5 day total is now 116 buys to 43 sells, a spread of +73. That's still bullish, but down from +87 on Wednesday.  That trend has also been diminishing, but positive, since a peak reading of +218 on Thursday, May 20. The surge of buy signals showed that bunch of stocks were set up for rallies, but it hasn't shown up. Does it mean that a collapse is imminent? Probably not. But i'm not trying to anticipate with this. I'll just follow the numbers as they develop.  

I screen all stocks and ETFs from the NYSE and NASD, excluding those with less than an average of 1 million shares per day traded, and selling for less than $6 per share.  The table below shows swing trade buy signals and sell signals from yesterday's action. The numbered columns represent the time frame of the support or resistance trend around which the signals were generated.  

Here is today's  output. The number 1 indicates that the condition is true. 0 is false. The numbers on the right half of the chart represent the time frames in days of the support or resistance areas where the signal was triggered. 

Symbol Buy Sell 500 200 125 50
ACAD.O 1 0 0 0 0 1
ATI 1 0 0 0 0 1
AME 1 0 0 0 0 1
T 1 0 0 0 1 0
AXTA.K 1 0 0 0 0 1
BCS 1 0 0 0 0 1
BLMN.O 1 0 0 0 0 1
BSX 1 0 0 0 0 1
CPE 1 0 0 0 0 1
CWH 1 0 0 0 0 1
CPRI.K 1 0 0 0 0 1
CB 1 0 0 0 0 1
CLF 1 0 0 0 0 1
SID 1 0 0 0 0 1
CTVA.K 1 0 0 0 1 0
DG 1 0 0 0 1 0
ETN 1 0 0 0 0 1
ECL 1 0 0 0 1 0
FNB 1 0 0 0 0 1
GGB 1 0 0 0 0 1
COPX.K 1 0 0 0 0 1
HP 1 0 0 0 1 0
HD 1 0 0 0 0 1
HMC 1 0 0 0 0 1
HUN 1 0 0 0 1 0
IVZ 1 0 0 0 0 1
LNTH.O 1 0 0 0 0 1
LAUR.O 1 0 0 1 0 0
NSC 1 0 0 0 0 1
OXY 1 0 0 0 1 1
OIS 1 0 0 0 0 1
PK 1 0 0 0 1 0
PWR 1 0 0 0 0 1
RIO 1 0 0 0 0 1
SBSW.K 1 0 0 0 1 0
XHB 1 0 0 0 0 1
FTI 1 0 0 0 1 0
UMPQ.O 1 0 0 0 0 1
UNFI.K 1 0 0 0 0 1
X 1 0 0 0 0 1
VLY.O 1 0 0 0 0 1
VET 1 0 0 0 0 1
VOD.O 1 0 0 0 1 0
WETF.O 1 0 0 0 0 1
ZION.O 1 0 0 0 0 1
ACN 0 1 0 0 0 1
COLD.K 0 1 0 0 0 1
PLAN.K 0 1 1 0 0 1
CHKP.O 0 1 0 0 0 1
CMS 0 1 0 0 0 1
DLTR.O 0 1 0 1 0 0
GEVO.O 0 1 0 0 0 1
IGSB.O 0 1 0 0 1 0
NVS 0 1 0 1 0 0
OKTA.O 0 1 0 1 0 0
SJI 0 1 1 0 0 0
SPSB.K 0 1 0 0 1 0
W 0 1 0 0 0 1
WDAY.O 0 1 0 1 0 0
Totals 45 14 2 5 13 41
5 day Total 116 43 Spread 73    

Every weekend I use the previous week's screens to select charts that have potential for a move, and I post them for subscribers.  This is raw data. These are not recommendations. They represent charts that have triggered short term signals near key cyclical support or resistance levels. Pick through these and see if there are any that you like using your own charts. Feel free to post your charts here with comments. 

The Meat Grinder Prevails – Swing Trade Picks For Week of May 24, 2021

 

You can see which ones I actually pick each week by subscribing to Technical Trader. Try it for 90 days risk free (first time subscribers).

Here are a few sample charts from today's screen that look interesting. These are NOT RECOMMENDATIONS.  They're interesting for different reasons. Feel free to comment.

Click the chart to enlarge

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The balance between QE and Treasury supply will remain bullish through through xxxx (subscribers only). This should provide a boost for stocks. It should keep the Treasury selloff at bay for another month or two.

However, this is not as bullish as I first thought. It appears that around 75% of the T-bill paydowns are going to money market funds and other institutions who must hold short term instruments instead of lengthening maturities or buying stocks. So most of the cash from the paydowns is ending up in Fed RRPs.

Only about ¼ of the money has been used to buy stocks and bonds. So the effect has been muted. There’s no massive blowoff. Instead conditions lend themselves to a churning topping action lasting through xxxx (subscribers).

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Lee do you remember how you found out that last years budget bill stipulated reducing the Treasury account to $133bn by the end of year? Did TBAC mention it.  That is the only way I can figure out that anyone would know.   It was a profoundly dumb thing to do but nobody ever mentions it.  Except maybe TBAC which has been urging a $500bn  balance for years. 

Who did it and why I am sure we will never know.  I would guess 99.9% of congress doesn't have the slightest idea about it.  

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1 minute ago, Jorma said:

Lee do you remember how you found out that last years budget bill stipulated reducing the Treasury account to $133bn by the end of year? Did TBAC mention it.  That is the only way I can figure out that anyone would know.   It was a profoundly dumb thing to do but nobody ever mentions it.  Except maybe TBAC which has been urging a $500bn  balance for years. 

Who did it and why I am sure we will never know.  I would guess 99.9% of congress doesn't have the slightest idea about it.  

I don't remember. And that's not a good thing. I've had a few brainfarts lately that worry me. Gotta eat more of those whatchamacallits. 

 

Oh.

 

Right. 

 

Mushrooms. 

 

Yeah, that's it. 

 

 

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