Action has finally started to pick up again in the markets which means we can finally consider the possibility that a topping pattern may be forming.
Consumer sentiment levels have been very bullish (averaging over 47% bulls over the past 7 weeks) and this past week sentiment moved above 50% bulls for the first time in that period. That can often be a sign that markets are over bought and can forewarn a correction.
Markets saw a surge in pre-market this morning (again) on news that Greek politicians have reached an agreement on austerity plans. Then, following new jobless claims numbers (initial claims were lower, but continuing claims rose from 3.451 mln to 3.515 mln), markets surged up to make another new high only to see sellers immediately come in and reject price lower. The ES is now consolidating between 1347 and 1349.50 ahead of the open.
I think the highs are in for the day at 1352.75 ES.
Levels to watch on the ES:
Resistance above at: 1352-1353
Support below at: 1343.50-1344.50, 1338-1339, 1331-1332
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