S&P 500 Levels & Analysis 5/16/10

The SPY is trying to find support at the 38.2% retracement of the May 6 low to the high last week, breaking below Friday’s low is likely to lead to a test of the 50% retracement which would also close the gap from last Monday. The VWAP “since the event” for the SPY is now found ~114.44 and that is a level the market will need to recapture before a test of last weeks support ~115 is tested and potentially becomes resistance. The market is still feeling aftershocks from the cascade lower and until it settles down the environment will favor shorter term traders.