Securities Research Services

Wednesday, June 04, 2008

The Risk Assessor Does Its Job

The SPY has now carved out a right shoulder on a head and shoulders top formation. Note the failure at the 200-day average and now the close back below the 200-day EMA. A close below $137 will confirm the head and shoulders pattern and set up a potential decline back to January and March lows at the $136.00 area.

Meanwhile, note that oil continues to correct after putting in a top at its channel top on the heaviest volume in recent years. The USO target for this correction is the 50-day average at $95.90.

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