03/06: Market volatility extends into June; near-term upside

Markets today appear poised to venture firmly into higher territory, with /ES futures holding stubbornly above 1100 in overnight trade. Technically, the inverse head-and-shoulders pattern of late May in the /ES appears sound; it marks a near-term market capitulation. I expect a high probability of further appreciation to approximately 1120, at which point e-mini futures will encounter significant resistance of the upper price channel comprising nearly two (tumultuous and highly significant) months of price action. A dip to about 1090 -- the less robust mid-point of the price channel -- is possible prior to the ascent to 1120, and a re-test of 1100 is highly probable. And, finally, I expect markets to abstain from a rally at 1120 until after tomorrow's AM release of the May unemployment number.

Here's a wide-lens view of the pivotal e-mini contract: