What a FANTASTIC week we had ,, changing from bulls to bears at 1330-1335 SPX and added to the position as we broke below 1320 on SPX and went heavy full in shorts! Congrats to those ho had shorts last week , we pretty much nailed the change and we also made some great daytrades for the days.

All in all ,, my long term roadmap is still due – and is following the script pretty much as we still have NOT broke above March 2012 highs (in all World markets) but we have been plunging down in the markets.

Right now I think we are at a zone ,, where markets can crash – this is a zone where people trying to buy the dip , thinking we will bottom ,, but as VIX broke higher and closed above 25 , its increasing the risk that possible crash or (hard sell off) might occur.

So as we moved into June as I expected last months ,, I said … summer months could be truly ugly and a possible crash could occur ,, hysteria and panic should be high there – and this is what you are betting on ,, being long voilatility.

1. USD has now broken SHARPLY higher ,, having a nice move up , and as predicted – might go up to the 90s area before a short term top – however USD is in a long term bull market imo and if I’m right ,, euro is just about to crash further possible.

If you look at the LONG TERM Euro chart you see ,, if it breaks below 1.2 ,, everything could fall apart in the markets — I’m thinking it might very well hold 1.2 for a good bounce,, but if negative news about Greece mid June ,, it could flush down hard.

2. All long term charts – SPX having monthly bearish divergences ,, monthly MA50 about to make a death cross with MA200 and so far you see the SPX made the backtest early this year and topped out there so far. I said – that this were a very bearish backtest before markets could take and begin a long term drop.

3. What is coming here in June/July will give you an indication what I expect more of next years ,, if we continue with selling next week most likely I dont think it will just stop ,, actually I think it will even get WORSE the closer we come to end of June as my cycles expecting the biggest and most nasty drop possible by end of this month.

4. All EU markets looks ready to break down ,, also canadian markets as you see TSX ,, this is just about to breakdown of a weekly bearish top hs patterns and I see those bearish patterns still everywhere – this is why I said ,,, I’m still seeing the same picture on the long timeframe ,, no change in this – so as I said many times early this year ,, and warned people that we were close to a very long term top – I still stand by this call and I think the top is still in. So we wont see this top in the next years , but we should keep going down in the markets as we entered a bear market.

All in all – congrats to shorts so far and to those who have been patient with their shorts ,, right now its giving good profits and I think its just STARTING —– I think after this month in June ,, you would know what I talked about so lets see. I cant rule out markets could go all the way down to 1180-1200 SPX in the next few weeks and if we break this , we could crash down to October lows pretty fast. All in all – as long my signals telling me now to be short I’m holding all in shorts for this. And if I see a possible bounce coming , well then I’m going to play it… but again dont expect a bounce this will be true pain……

Chris