Historically, the “Optimal Momentum” concept of buying the best performing asset class out of a basket of loosely correlated asset class’s has annualized a return of 17.2% since 1977 with a maximum monthly drawdown of -25%. As a comparison the S&P has only annualized a return of 8% with a maximum monthly drawdown of -52.5%.

The June E-mini S&P 500 closed higher on Tuesday, forming a closing price reversal bottom. Based on the current short-term formation, traders should watch for a 2 to 3 day retracement with 1105.75 to 1122.00 the next upside target.

The EUR USD settled into a range after gapping open and pulling back from its high throughout the New York session, as traders awaited more details about the Greece bailout package. In addition, traders are waiting for Tuesday’s Greek Treasury bill auction.

The U.S. stock market rally stalled after an early morning surge following dovish comments from Fed Chairman Bernanke. In his testimony before the House Financial Services Committee, the Fed Chairman reiterated that interest rates would remain low for a prolonged period of time. While acknowledging that the economy was improving, Bernanke did say that high unemployment remains a concern.