We posted to Twitter on May 30th snapshot of Head & Shoulder Topping Pattern along with post: “IF plays out THEN price projects down to 1600 (160 SPY) http://twitpic.com/cu93q8/full .

With yesterday’s sell-off price got within a stone’s throw of the target…LOD = 1605.50. This could mark an important corrective low as price is -4.78% (-80.64 pts) from the highs. So it is very possible that the recent correction is nearing completion. Be watchful for new signs of strength on the larger degree to confirm lows. (i.e. We closed Long SPY 160 Jun Put position yesterday at 2.00 and 2.05..Cost basis 0.80..nice % gain indeed)

Today’s levels to watch: Prior Day Low (PDL) 1605.50 (key marker)…IF retested and holds, THEN price has potential to rally to 1623 – 25 zone initially…beyond this zone we’ll revise in trading room. IF 1605.50 is violated, THEN downside projects 1590 – 96 zone.

Recent price action suggests two-sided trade ahead of important Jobless Claims today and Monthly NFP Report tomorrow.

Good Trading…David

Habitude Eight:
I can recover from any setback. I have an attitude of abundance. I affirm abundance in the universe. I know I cannot begin to count the stars. I realize the ocean doesn’t care whether I go to it with a bucket or a teaspoon. I know the market provides a river of opportunities. I invest in my capabilities. I will be happy with my results.