S&P 500 Key Levels 6/1/12

The $SPY has shown a premarket low of 128.64 which is just above 200 day moving average (currently at 128.59). The market has also broken below the volume weighted average price (vwap) from the October low through yesterday’s close, this indicattes that the average long participant during that time is now losing money. Another level which has been lost is the 38.2% retracement of teh October 2011 low to the 2012 high (128.97) We have noted that the market trend is lower and should be treated as guilty until proven innocent, that still appears to be the prudent approach. Perhaps the market will attempt to stabilize near these key levels but trades should be super selective in this environment.