First of all – what a fantastic week we had in the room – starting out the week with shorting the markets down from 1391 and held shorts into mid week and began buying longs heavy again on Thursday just before the big pop on Friday again ,, so much congrats to all those who had the faith and held through these moves – we nailed them pretty much near the tops and bottoms for this week!

Euro spiked nicely higher as we called in the room on Friday and I still think there is more upside in euro, with TLT going down nicely as we also expected which helped stocks going up.

1. Euro looks like having more upside like charts tells me – so most likely a little bit more upside in stocks , but right now very very close. My SPX target of 1394 hit on Friday as I had few weeks ago as a possible target. However looking at euro it looks like more upside is possible

2. TLT and TBT also shows me that there is more upside left in the rally – I think TBT will go some higher early this week and this would help pushing mkts a bit higher.

3. All in all 1400 is a “psychological” barrier – I think the crooks on wall street will push us above 1400 to make every single short stop out so they think new highs is coming ,, so very likely a push up to target 1404.4 which is the inverted hs pattern target back in June.

4. There are so many bearish divergences all over the place , so dont chase upside now all charts is telling us danger is ahead and markets could turn quickly back down and very sharply – so be quick and ready to go short.

5. Right now we remain long from the area 1355-1360 area as of Thursday where I called to buy longs in chat room – and so far we remain long over weekend as there is still possible more upside left, but I would NOT chase the rally as of Friday ,, but this time we wait for signals to get short heavy again and when we get signals to do this we go heavy short , until then we try to ride the rally as much it wants to go up.

6. Target of the inverted hs pattern on NDX is 2700 which funny enough is also a major GAP FILL , I think we hit 2700 on NDX early next week before tops out.

So all in all conclusion: I think we are very close to end the rally from June lows this year ,, it has been a very choppy and “weak” rally overall and it looks very corrective , possible big bear flag. SPX should top out before the 1422 highs I guess we get a littel above 1400 to stop out all shorts and then go fast sharply down again. Euro and TLT still telling me more upside left early this week so we hold longs tight, but ready to switch heavy to shorts again when mkts tells us to do so.

After the top is hit , the next downside target for wave 3 down is 1200 and possible lower, so dont get too confident about upside here 🙂

See you all Monday and enjoy the weekend !