SPX Support Heading Into June Expiration

Kent Shaw has again calculated D-Level support for the SPX, which is much needed news for those bull put spread and iron condor traders with open positions as we near expiration.

I've got D-Level support calculated at 1225-1229 for the SPX, illustrated in the chart below.

Also take a look at the Detrended Oscillator --- the market is extremely oversold and is now approaching a level similar to some other major turning points. I think we're pretty close to a tradable bounce.

Support Calculations for SPX

Support Calculations for NASDAQ

Personally, I'm going to wait until the support level on the chart below is tested before I step into anything. This method has served me very well over the last year and is extremely helpful in managing risk and gaining market perspective. Given the very heavy selling in small caps relative to large caps, I would expect the SPX to bounce pretty hard as institutional money tries to position itself for the last gasp of this bull market. Putting on some short put verticals below the support level (1225-1229) is probably how I'll play it and possible some long SPyders.

-Kent Shaw

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