06.27.2011 -- Pause til end of quarter

It's looking like we are either taking a pause in this selloff until end of the quarter (this Thursday), or we are going to try to breakout and close the quarter out on as high a note as possible.

We are in a heavy resistance and support area, it will take some doing for the market to break in either direction.

Support/Resistance..

Support -- 1265 (200dma) and 1250 (round number and trendline)

Resistance -- 1285 (trendline), 1290 (trendline), 1295 (middle of the bollingers), and 1316-1320 (50dma, 100dma, top of the bollingers)

If they really want to gun the end of Quarter, they'd try and target 1315 by Thursdays close.

Here's the S&P chart;

As you can see, we are stuck in the middle of a little CF right there. Time is running out though, if they don't try to make a move north by Thursday, things will get more interesting and the 200dma and the downsloping trendline will force the issue by the end of next week.

As mentioned, end of quarter, they are gunning all the momo stocks, Amazon, Chipotle, Lululemon, Green Mountain Coffee,.. they've all been bought hard since the 2nd week of June. Prop up those large growth holdings to make the quarter look good and then I expect we may see some distribution out of those types of names.

I think even with all this hard buying of the momo stocks, we are having a hard time even challenging the middle of the bollinger bands, and with only 4 days left until interest in propping up big growth winners goes away, I'm thinking the most likely path going forward is down for another challenge of the 200dma and a challenge of the recent 1258 low.

GL

CJ