Outlook on SPX week ending 12 June 09

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SPX range in May was 880-930, while in the first week of June has shifted a level up from 930-950. Therefore major Ressistance and Support Level for this week will be:

Potential Resistance:

R1: 951.69, high of 6/5/2009

R2:1,007.51, high of 11/4/2008

R3:1,014.14, Fibonacci 38.2% of 2007-2009 drop

Potential Support :

S1:931.12, high of 06/05/09

S2:923.85, high of 20/5/2009

S3:878.94, low of 15/5/2009

For Monthly and Quaterly Options:

If it breaks out above 950,with next resistance at 1007 , I will look to sell Jun5 09 (Quaterlys) 1000/1025 Call @ min $8 preminum which will be if SPX reach the level around 975. The exact entry level will be determined when 10ema and 20 ema will be above 47sma, on either 123 and ross hook formation or 3 bar reversal on 20 ema, or on crossover between 200ma(which is now 916) and 50 ma (which is now 880). If the 1000 Call get in the money I will just rollover it to the next month as if market goes above 1007 there will have to be some retracement to previous price level before bulish market can occur.

If it breaks down the support at 931.12 , the support at 923.85 is to near so will sell Jun09 915/910 Put as there is minor support level at 913.

This week economic events:

Wednesday 10 June 2009:

US: April trade balance (1330 BST), -medium impact

W/e 04/06 crude oil inventories (1530 BST), - medium impact

Beige Book (1900 BST),- low impact

May Treasury budget (2000 BST)- low to medium impact

Thursday 11 June 2009:

US: W/e 04/06 initial jobless claims (1230 BST),-medium impact

May retail sales (1330 BST), -medium to high impact

April business inventories (1500 BST); medium impact

Friday 12 June 2009:

US: May import prices (1330 BST), -low impact

June preliminary University of Michigan consumer sentiment survey (1455 BST);-low impact

For Weeklys:

Already have sold on friday Jun2/09 925/900 Put @ $5.30 If after the news market opens with a gap above 951.69, will wait for retracement to the middle of todays congestion area and then if good buy signal shows( bouncing off the 47sma) or price reversal will sell 975/1000 CallIf the market goes down and my 925 Put gets in the money will wait till Thursday and then sell a Put spread at a lower strike.

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