The S&P 500 came to rest only seven points below the recent multi year high achieved on February 20. It will be instructive to see the tactics of index futures traders if the 1460 level on the cash index is challenged in today's trading.

Also in focus on our screens today will be the weakening dollar and the Treasury market. The yield on the ten year note closed just four basis points below the pivotal 4.8% level.



Dollar weakness was one of the underlying themes in the capital markets last week. There is a distinct possibility that the euro could breakout to an all time high against the dollar in trading this week.

One of the beneficiaries of this weakness has been gold. We review a couple of gold miners below that are showing breakout patterns but the gold index (^GOX), despite a strong move in Friday's trading still has a little further to go before we reach the recent multi-year highs above 170 achieved in May 2006.



The Nikkei 225 (^N225) closed Monday’s session with a 1.5% gain that reversed Friday’s downward trend day. The index however closed just below Friday’s high.



TRADE OPPORTUNITIES/SETUPS FOR MONDAY APRIL 16, 2007

The patterns identified below should be considered as indicative of eventual price direction in forthcoming trading sessions. None of these setups should be seen as specifically opportune for the current trading session.

Goldcorp (GG) moved through its 200-day EMA in Friday's trading and closed at its highest level since February 28. Volume was fifty percent above the 15-day SMA and the $29 level would appear to be an intermediate term target.



The chart for Kinross Gold (KGC) is also pointing to a potential breakout for the precious metal itself.



The chart for Q Logic (QLGC) has a bullish flag formation and this could portend a move to the top of the 40-day volatility bands around $18.40.



We will have Hasbro (HAS) on our Watch List today. Although there is no clear signal yet from the incomplete formation, Friday's inside day on very low volume could be a precursor to a corrective move.



Clive Corcoran is the publisher of TradeWithForm.com, which provides daily analysis and commentary on the US stock market. He specializes in market neutral investing and and is currently working on a book about the benefits of trading with long/short strategies, which is scheduled for publication later this year.

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