Market view

Well well - as called the QQQQ had a bearish MACD cross yesterday monday and plunged yesterday. SP500 and DOW holding pretty good but should get bearish MACD cross today(Friday) which should make them plunge big today.

First of all according to the put/call ratio which gave me a buy signal in TZA at 19.4 on Friday and yesterday the most bullish readings were "UUP" which is the dollar and which indicates that the dollar have more upside near term. The most BEARISH readings was EEM(Emering markets)FXI (China) and FXE(The Euro) which indicates that these ones have more downside left.

Right now when I am writing the Shanghai is down -5% overnight (Surprise!?!?...) this is the start of a big correction/crash I think and there will come a lot more. All the GDP data from EU was really bad and ugly.......

Think about it Germany the most important in EU was revised from last 2.3% growth, expected 0.8% and came at 0.7% !! So thats a big drop from 2.3% to 0.7%....(Yeah bullish if we had QEII)

Now G20 came to a deal that they wont devalute their currencies so lets see if the dollar wont be able to rally on this now with all this EU crisis here.

Well lets talk about the technicals, the dollar UUP broke recent resistance at 22.62 and holded above it and sitting near its trendline from the lows. So if its holding the dollar should bounce higher from here and the euro should go down.

What I found really interesting yesterday was the FXE(Euro) weekly chart which had been traind in the range of the MACD trendline (bearish) and is making a bearish engulfing on the weekly chart - with the dollar making a bullish engulfing on the weekly chart. That tells me that the dollar has a lot more upside to come over next weeks and the euro have more weakness. (which indicates markets dropping and my shorts rally - look at the FXE chart yesterday)

As I posted the charts with CSCO and market top I actually think that the top is in and we wont see this top again in the next 7-8 years or so.

The AAI sentiment is at HIGHEST level in 2010 and have not been this high before(So many bulls at the moment and overcrowded). The insider sell/buy ratio is at EXTREME and last week was the highest reading ever over the last 100 years ! Think about that.....if we are out of recession and if everything is good...why the heck do all the insiders from the persons who are RUNNING the country sell everything..... Dont be stupid... the COT (smart guys) are short these markets and the dump money is (long markets now) according to the COT report.

NASDAQ broke yesterday below the trendline and made a clear backtest of brokentrendline. (Kiss of death) which means an ugly move should come to the downside now.(Well China -5% tonight) so lets see today.

I got my last TZA last friday at 19.4 and but overall I'm down on my shorts but I think I can fast get in profits with some patience here.

Looking at the VIX chart its a in huge falling wedge and I can easy see a breakout of this falling wedge which should indicate huge selling in markets. (VIX above 20-21) would indicate break above trendline

All in all - staying short and holding. Lets see our first short term target today is 1196 SPX but if we break that I think we can see 1170 today especially if we follow China market down.

Have a great day (Long the dollar, short the markets)