Jun 23

Weekend Outlook for 23th June 2014

Markets keeps grinding slowly higher and are at all time highs yet again.

I have been wrong about a large correction this summer and as we havent got one already , I believe we wont see a large correction right here and now.

For the short term however we might see a pullback….. the reasons why…

1. VIX is at all time lows, looks SHORT TERM bottomed, VIX can remain at low levels but usually when VIX is near 10 we see a large spike higher the weeks after. So I bet that VIX should see a rise from 10 this week.

2. NYSI makes a very bearish divergence on daily chart , this is not boding well for markets near term

3. Also SPX making a very clear bearish divergence on daily chart , RSI and MACD all indicating a larger pullback is due soon. However we might start this week with an early spike up to 1970-1980.

4. Gold saw a massive rally last week , I expect Gold to pullback down to MA50 and MA200 before rallying higher.

Conclusion: All in all , expect mkts to see a short pop higher early this week into 1970-1980, then expect a larger pullback at least down to 1920-1930 level. So for the short term I’m thinking a larger pullback finally is due, but I dont see a very large correction right here.


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