Jul 20

Weekend Outlook for 22th July 2013 – Markets topping – be prepared for another correction

Markets has so far followed the roadmap and made new ALL TIME HIGHS both on SPX and Dow Jones this week with the highs currently at 1693. I have been targeting 1700 as a major high in mkts and we are extreme close to those levels.

If you made great profits being long stocks since 1560 , then take profits of the table. Fear levels is once again back to extreme low levels where I would go long voilatility and those levels.

There are major bearish divergences on all timeframes – both 30min, 60min, daily chart + weekly charts. This USUALLY tells us we are near a MAJOR top – but I still believe that the bull mkt is not done yet. However all charts suggesting a larger correction again underway.

Note VIX also making higher lows , with SPX making higher highs , another signal that a major high might be near.

All in all – risk/reward clearly favours downside in mkts at those levels – we might see a little spike higher and wont rule out we could go a bit above 1700 – but be prepared cause another major correction should be underway bigger than the one we had last month.

 

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