On 4/26/10 we began to question if the equity rally, since correcting in February had reached an overbought situation at the end of April. The markets seemed to need a reason for selling the equities. The situation in Greece and the selling of the Euro was the fundamental reason to offer a meaningful correction. Read "Greece is the Word".

On 4/27/10 we received longer term signals in the DJ, S&P and NASDAQ futures to at least offer a sideways market if not a selling market. During the past few weeks we have received some confusing signals. On 5/20/10, we received a stronger sell signal for the E-mini S&P futures contract (basis June).

From the recent weeks of selling, the market could find an upward bounce, but we believe the market will try once again to test the recent lows of 5/21/10 and 2/5/10 at 1051.25 and 1036.25 respectively before moving higher.

In the short term the E-mini S&P June futures has support in the 1057 to 1036 area. If this test fails and the market moves lower, than our next level of support is 1010 to 971. We do have a longer term price point of 890. This should be the bottom or near the bottom of this correction. We don't believe the market should reach the 890 price point, (unless the fundamental news gives more reason for the market to fall) but if it should it would send a lot of fear into the market and it probably be a choppy way down to that level.

The resistance for the market should be found at the 1075 to 1095 area. If the market should find a bounce, the next resistance level would be 1110 to 1130 area. As this is a holiday week, there could be a possibility for the market to bounce later this week primarily due to shorts covering their positions for the holidays.

The remainder of this week will also produce more economic reports that could add more fuel to the fire of selling if the reports are not better than expected. And of course on Thursday the weekly jobless claims will be released.

Stay tuned and put your seat belt on, this could be a bumpy ride.

Today Bloomberg news reported Abu Dhabi's Emirates Palace hotel is now offering a gold vending machine.

This is the first machine the German vending company (TG Gold-Super-Markt) has offered outside of Germany. The vending machine will offer small bars of gold as well as gold coins. The machine will monitor daily gold prices.

Historically when commodities make the headline news and reach out to the retail investor, such as all of the recent television commercials stating how gold has rallied in recent years and why investors should buy gold, this may be a telling sign of at least a short term correction in gold. Keep in mind yesterday gold price made an all time high.