The June E-mini Russell 200 Index is up overnight. The move to 949.40 made 931.60 a new main bottom and put the index in a position to challenge the March 15 contract high at 951.00. A move through this level will reaffirm the uptrend.
Fundamentally, the only story of the day is the reaching of an agreement between Cyprus and the European Union. This news calmed investor fears of a financial crisis in Cyprus, driving investors in higher risk assets.
Look for thin trading conditions and volatility at times since this is a holiday week. The lack of major economic reports may keep many traders on the sidelines. Another key to watch is the follow-through rally. Investors want to see new money entering at higher levels. This would be a sign of conviction and higher markets to follow.
New support has been established at 943.60 and 941.30. A move through these levels could trigger a further decline to 931.60. A trade through level will turn the main trend to down.
