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From a short term technical perspective the June S and P futures contract is trying to turn up. It is easy to see that there is substantial technical resistance around the 800 level. We should see several test of this level this week.
The market is acting in anticipation of the re-inflation of toxic assets via the "new Geithner plan". This news should be respected as it is likely to create an overall bullish tone.
It should be obvious that asset buying by the Treasury and low interest rates are likely to have a very bullish effect. The big question is how much and for how long?
The market is certainly showing some technical resiliency for the first time in several months. We will be watching the slope of the 40 day average closely. More on this later in the week.
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