Market Update for Wednesday, June 1, 2011

The markets sold off severely today. IMHO this was a healthy move. E-mini is almost at oversold levels on the 4-hour chart. I think tomorrow will hit the oversold level. SPX, is also close to reaching oversold but on the 1-hour chart.

I went long today and bought UPRO again at $77.7 I think I should have waited until tomorrow for the oversold level, but I don't want to miss the train and I feel this is a good entry price. Also, I am not able to be in front of the computer all day these days.

My recommendation is for you to go long tomorrow and buy UPRO, SSO or SPY; whichever you feel more comfortable trading. Even if the stock price moves lower than your buy price, hold on to your shares and wait. If you don't feel comfortable, place a stop loss order at 1% below your buy price on SPY, 2% below your buy price on SSO and 3% below your buy price on UPRO.