June S&P 500:
1. Our previous update indicated that a failure at $1884 or lower in the June S&P 500 would indicate new short position for a relatively quick decline from $1884 to a test/attempt at $1858/$56 (or lower) into Friday, May 9 (+/-1 day).
2. The market failed at $1884 (and $1879) and declined, making a Friday, May 9 low of $1862.50, approximately 4 points above the natural position for the market at $1858/$56.
3. Traders exited a portion of their short position at $1865 (noted in the original update) and the remainder was stopped out at our adjusted $1875 protective stop noted in the previous live meeting.
4. Friday’s near miss of the $1858/$56 downside target is unusual behavior and may indicate unusually internal strength in the market. Will update.
June S&P 500:
1. A daily close today (Thursday, May 8) in the June S&P below $1879 (worst-case $1884) will indicate new short position for a relatively quick decline and test/attempt at $1858/$56 (or lower) into Friday, May 9 (+/-1 trading day).
2. Initial short position exit should be taken at/near $1865.00. Further exit at/near $1858/$56. A small remaining position should be held for the possibility of lower prices which will be messaged in a subsequent update.
3. Once short a protective buy stop should be placed at $1887. This stop will be moved lower as the market continues to confirm. Will update.