Art Cashin: The Next S&P Resistance Level

Foreclosure filings in May dropped 6 percent from April — but were still up 18 percent from May 2008. Meanwhile, sales at U.S. retailers rose in May and initial jobless claims fell for a fourth straight week.

Art Cashin's Trader's Edge
Art Cashin's Trader's Edge   

Art Cashin, UBS Financial Services director of floor operations, offered CNBC his market insights.

Despite the seeming positive of lower first-time unemployment claims, Cashin said that's only part of the story:

"Continuing claims continue to be a problem," Cashin said. "...It continues to look like if we get a recovery it will be a relatively jobless recovery and that'll be something we struggle with."

Cashin quoted Pimco CEO Mohamed El-Erian's warning that there are hidden dangers to the recovery buried in the very signs investors are clinging to:

"It's not really green shoots; it's still more of Mohamed El-Erian's 'second derivative' — a change in the rate of change."

What CNBC's Guests Say:

He reiterated his analysis of the late-day rally pattern: Traders "come in and they hold their noses and put a bid into the market."

He sees a populist threat emanating from the congressional hearings into Bank of America's purchase of Merrill Lynch:

"A little political grandstanding could accidentally do some damage to the credibility of the Fed chairman while we're in a crisis. That could be far worse than anybody could assume."

Where is the stock market going? Cashin predicted:

"I see the next [S&P] resistance level if they get up to and through 1,000 — not too much above, about 1,050."

Financials Now:

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CNBC Slideshows:

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CNBC's Companies in the News:

Bank of America

Citigroup

General Motors

Ford Motor

JPMorgan Chase

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Disclosures:

Disclosure information was not available for Cashin or his company.

Disclaimer