Final Thursday in May – Back to 2,728 on the S&P 500

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"When I get to the bottom I go back to the top of the slide

Where I stop and I turn and I go for a ride

Till I get to the bottom and I see you again" 

We're closing out the month back at the top of the slide (so far) after a wild couple of days that took the S&P all the way down to 2,675 (down 2%) before blasting back yesterday to retest our 2,728 (strong bounce) line on the S&P 500 (/ES).  We'll have to take today's action with a grain of salt as it's the end of the month and yesterday's up volume on the S&P ETF (SPY) was half (67M) of Tuesday's down volume (115M) so the "rally", as they often are, is half-hearted at best.

We'll wade through a lot of data this morning with Personal Income and Outlays at 8:30, Chicago PMI and Consumer Comfort at 9:45, Pending Home Sales at 10:00, Natural Gas Inventories at 10:30, Oil Inventories at 11 (we're bearish) followed at 1pm by the Fed's Lael Brainard's NYC speech on "Economy and Monetary Outlook" – such fun!  

Brainard is a Fed Centrist so we'll see which way she tilts this afternoon but not much of this matters on a window-dressing day though, as I noted to our Members in yesterday's Live Chat Room, either the end of the month or the beginning of the next month has been cause for a sell-off every time this year.  Since we feel 2,728 on /ES is going to be the top, it makes sense to short the index here (2,725) with tight stops over 2,728, which would be a $150 per contract loss.  

Yesterday, in our Live Trading Webinar, we also discussed shorting the Russell (/RTY) below the 1,650 line, but we're above that now and, of course, we're still happy to short the Nasdaq (/NQ) below the 7,000 line, as we still expect an eventual…
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