SHOGUN TRADING STRATEGY
DAILY ANALYSIS FOR 05/01/06

(Use this chart and commentary to plan your trades. The goal is to trade with the market, never against it. This chart will show our expectation, projection and commentary. This is a very important tool for you.)

SHORT TERM ANALYSIS

The market is back on top of the 1700 support level.

LONG TERM ANALYSIS

Right on top of long term support. We are back at the same spot waiting for the same event.

TRADING CONDITIONS

The market is back at support again. If it breaks the 1700 support level, it could start a long term down trend.

I am saying it "could" because it has tried many times before and did not have enough momentum to follow through into a down trend. We are, basically, at the same spot right now. It looks ready to break again, but not enough momentum. Expect some more volatility back and forth before break down.

Remember that the market has been on the verge of breaking a major support or resistance level since the first of the year. Objections at rest tend to stay at rest and objections in motion tend to stay in motion, that is the basic concept of inertia. The market has to break and actually start moving before we will pronounce it as a new trend. As long as it barely breaks a major level, it is just not enough to be a new trend.

Stay conservative, don't go out on a limb, wait for the market to prove to you that it wants to get moving before you commit to it. In the mean time, just make money on the small moves.

May is a new month, but all the same set of news. Iran, oil, rates, Iraq and so on are still all the same.

Hope this helps,

Shay Horowitz - ShogunTrading