IOM JUNE S&P 500 INDEX: Minor trend up, major trend up.

Moving Averages--Positive--5-day 825.64, 20-day 786.42; positive-- 4-day 827.91, 9-day 812.00, 18-day 791.26; 50-day 788.37.

Oscillators--RSI 65%, stochastic 78/87, MACD 12.13/6.44.

Resistance--838.20-838.40 *** key daily resistance/contract high (05-06-97). Support--809.80-810.00 ** key daily support.

Technical Indicators--Short-term market momentum remains up above the 813.40 area today. The market is short-term overbought and warns of a correction. Open interest has not confirmed the recent move higher.

Viewpoint--The market remains in the midst of a major uptrend on the daily and weekly charts, but is also short-term overbought and susceptible to an intra-week to weekly downside correction. The key today is important minor support at the 813.40 area. As long as it loosely contains price on the downside during the session, short- term momentum will remain up and our short-term outlook will remain bullish. The 20-50 day moving averages are close to crossing to the upside (bullish).

CBOT JUNE TREASURY BONDS: Minor trend up, major trend up.

Moving Averages--Positive--5-day 109.27, 20-day 108.10; positive-- 4-day 109.26, 9-day 109.12, 18-day 108.16; 50-day 108.17.

Oscillators--RSI 65%, stochastic 80/85, MACD 0.41/0.16.

Resistance--110.12-110.14 *** key daily resistance. Support-- 109.02-109.05 * key daily support.

Technical Indicators--Pivotal area where the next significant price move may begin. Short-term market momentum remains up above the 109.05 area. Declining daily oscillators warn of an intra-week move lower. Expanding open interest confirms the recent move higher. Viewpoint--Despite Wednesday's sell off, short-term market momentum remains up (bullish) today above important minor support at the 109.05 level. There is an important band of overhead resistance at the 110.07-110.14 level today. A close above this area would help to confirm the validity of the recent major bullish trend change on the daily chart. The 20- and 50-day moving averages are close to crossing to the upside, which would be more bullish confirmation.

May 9, 1997
John J. Kosar
Greenwich Natwest Futures, Inc.
311 S. Wacker,
Chicago, Illinois

Consensus National Futures and Financial On Line Index
Technical Corner Index

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