Friday, April 29, 2011

Market view



Well markets keeps grinding higher slowly and is beyond my target of 1350. So the outlook I have for now is that the markets is still very overbought and could roll over any day now - but there is a good possibility that they will do their window dressings done before. Time will tell the tale , but I updated a chart of what I think is forming and what I think is to come and expect.

The downside target of 1325 have now been moved up as markets has been moving slowly higher.


This means my objective target has been moved from 1325 to 1330 area - not much but possibility that we will be in the upper end of the 1320s which is near 1330.

So markets is sitting near 1360 now and a 30 point pullback in markets is to be expected in the near term.

On the charts you can see which kind of moves I am expecting with a pullback to the trendline in the pattern. This means markets should stop moving much higher here - and NOT go beyond 1370 - but hold below and possible we see 1365 --- but not higher than 1370.


After this pullback the markets should do a move higher to the 1370-1390 range imho which should end around mid May. The pullback should begin any day from now and last into early May. so I think any day from now to begin and then early next week more pullback.

Have a nice day

Thursday, April 28, 2011

Market view



As Bernanke opened his mouth the markets rallied - what a surprise woooah and ended in the green zone. The thing right now is that the markets is overbought on the daily charts and the volume on the rally since 1295 is weak overall - nothing special. But we can still trade up on low volume as we have seen before , but my target of 1350 got reached and we actually popped higher to 1356 SPX.

The big question for me is if we just KEEP rallying to my target of 1360-1380 which is my top target right now for the SPX or we will get the pullback I am looking for before to 1325 objective target.

So what I did yesterday were adding last shorts on SPX before close at 1356 and then hoping I was a few point wrong in my calculation of the objective top at 1350. We could easy dip below 1350 in the near term - but again if we move any much higher I will take a few % loss and move on - thats how I see it.

I'm still playing lots of small caps including SOMX which I love right now - SOMX (2.79 long) looks brilliant for a swing play.

So overall still looking for 1325 to be tested sometimes next week and after this pullback I think we will make new highs and move into 1360-1380 SPX my next target. So how do you play this? Well get long a few good small caps with technicals good setup and good fundamentals and get long a few shorts for hedge if we get the pullback - then its a good win/win situation.


Have a nice day

Wednesday, April 27, 2011

Market view



Markets hit yesterday the target I had perfect since 1295-1305 and told people we may very well see new highs in end of April/ Early May. We got it today which I nailed perfect since 1295 and actually yesterday I took profits on SPX from 1295 to 1350 or in the 1348-1350 area. My objective target has been reached and therefore I took my profits. We may go higher, but thats it , when we were near 1348-1350 I got into some shorts just for hedging myself.

I got into shorts at 1348-1350 level because I think we will get a short term pullback (Just a little one before we move higher) so I did not get heavy into shorts , but got a few for hedge myself against a lot of other small cap longs.

My objective target has now changed and I think after this rally since 1295 to 1350 we should get a little pullback to an objective target of 1325 over the next 1 week overall. I think we could see this level maybe over the next days into Friday - but time will tell and I am going to take the profits on shorts if we move to my objective target of 1325 or close to it - thats my plan.

30 min chart and 60 min chart also agree with me that a short term pullback IS comming soon and every other may say otherwise.

So I really nailed the rally since 1295 with a target of 1350 and lets see if we wont get a pullback. What I think after this pullback is to load back up on long positions again as we should see 1360-1380 next or higher levels.... so thats the time to load up positions in longs big time again imo.

This is just how I look at the things now - I think for the short term we are VERY overextended now and need a minor pullback where you could make a few % profits on the pullback from 1350 imo.

All in all short term trend is still up and if we move above 1356 I will cover my shorts with minor loss. Until then shorting since 1348-1350.

Bernanke to speak today stay tuned

Have a nice day

Tuesday, April 26, 2011

Market view




Markets did a minor pullback early trading and then picked up into close which were quite bullish actually. I thought we could pullback a bit more as markets has rallied since 1295 where I got long and still holding longs as my main target has not been reached yet.

On the longer time frames it looks like a big rising wedge which is very bearish , but we are still in it and we may still go higher before we breakdown of it. But sooner or later something gotta give - if its QE2 ending or not or we get QE3 , thats a big question. I for myself think we will get QE3 or rather say Bernanke will do EVERYTHING to get it - but may not get it if other rejects it.

The thing with QE is that we have too much inflation and already now its hurting a lot on companies and consumers. This will destroy the economy if inflation stays at these high levels. Prices really need to go down as it is only a question of supply/demand and the prices is too high now as the value of the dollar is also weakening.

But overall the short term picture looks quite bullish and my main target of SPX 1350 is still in the cards or a new high above 1344+

We are trading in a ascending triangle on the short term picture and I think we could breakout of this in the short term. Probably when Bernanke is going to open his mouth this week about the economy. But after a big run I was thinking more of a pullback to 1320 but seems like we wont get it ant just consolidate sideways like we did yesterday above 1330.

HDY my top pick for the week increased on a red day yesterday from 4.41 to 4.48 and is still looking good for this week. Lets see how it will do rest of week.

The short term trend also remains up so its harder to bet against the short term trend. The inverse HS pattern wants us to go way higher from here , but for now we may only go to 1344+ before a bigger pullback and then probably a big summer rally ? Who knows.... 1400+ in summer ? We shall see - but my personal target and objective target remains at 1350.

Remember I called a major top yesterday in SLV at 50$ and still holding by that call so got a few longer term ZSL yesterday as I think 50$ was a blow out top and psychological barrier. Time will tell if I'm right but thats my call.


Have a nice day

Monday, April 25, 2011

Stock play of the week


One small cap idea to go long for this week is HDY.

Right now its trading at 4.41 and looks like 4$ was the floor and base on this one , technicals looks very bullish to me and I think there is a great upside potential in this stock for a swing play as it is trading in a bullish triangle pattern with resistance right below 7$. This may see 7+ on breakout soon which could be a nice double over some time. I also like HDY fundamentals , so right now seems like a good place to go. This is one of my good plays this week - the upside % gains is good and above 50% for a swing and near a double bagger if we break above 7+

Also watch closely oil plays as oil is going to new highs early this week as called last week and you can play ROYL , TGC , LEI those small oil babies should pick up.

For now every week I will give out one play of the week on the long side for a potential swing play. For this week the best potential play is HDY swing play. Remember to stop out below support at 4$

Overall I believe that silver topped today at 50$ and think its a amazing opportunity to get short silver for the longer run. I think 50$ in silver is a psychology barrier and a blow out top just made today. You can short silver via ETF's.


Have a nice day and follow me on twitter to get live updates.

Friday, April 22, 2011

Market view



Markets kept holding strong on Thuersday before a longer weekend than usual. I still remain long SPX since 1295 and 1305 area where I got long and up with nice profits, I have taken profits but still holding other long positions. My outlook havent changed yet - the inverse HS pattern if playing out will have us to go a lot higher, but I really question a rally higher from here as we are EXTREME overbought at the short term now.

So what I think at the moment is a possible gap up on Monday to make the new highs above 1344+ which I have been calling for and then possible hit 1350 mark. If we see new highs on Monday I am going to take profits and move into shorts (Just for the short term) as I think we at least will just have 1 or 2 days pullback as the VIX is below the lower BB and when VIX moves above in the bollinger bands again that will give a sell signal in markets. I expect that to happend sometimes next week. I am also watching a trendline and we could be trading in a kind of triangle pattern with upper trendline at 1344 at the moment (recent highs) so there is lots of questions.

But for overall I expect a last pop up before a pullback, so if we gap up monday I am thinking about taking the profits and move slowly into some shorts. (Just for a pullback)

The VIX made a red hollow candlestick which usually marks a bottom - so a good possibility that VIX wont go lower here - but again , we might even see VIX near 12-13 if markets keeps rally up now.


I still think oil will see near 140 a barrel before topping this year and then a good move down again to below 100 a barrel later this year.

Oil looks ready for new highs early next week imho.

Remember I am extreme bearish markets overall in the longer term and according to fundamentals - but for now short term trend remains up and no signs of a crash move yet in markets.



Have a nice weekend and enjoy

Thursday, April 21, 2011

Market view



Markets had a BIG and nice rally yesterday - and we remain long markets 1295 SPX as the right shoulder in the inverse HS pattern seems like it will be played out.

My objective target is still 1350 area but the inverse HS pattern targets higher.

Actually my first target is 1350 , but then I think we might have a pullback before moving to 1360-1380 area.

So am I bullish now ? Yes , and I have been bullish as long SPX 1294-1295 were holding. Is the fundamentals great ? NO and it still looks very bearish by fundamentals , but the technicals works a lot better than fundamentals and you cant trade on fundamentals. So the short term trend is up and lets see if we cant see new highs soon, we might very well have a little pullback soon as VIX closed below lower BB.

My time zone for the top is around late April/ Early May.

Remember to follow me on twitter where I post daytrades and swing trades.

Have a nice day

Wednesday, April 20, 2011

Market view

Will be a short update today - and yesterday we had a very strong day and I still expect a rally to come with my objective target of 1344+ which means new highs.

Time will tell , we had a bullish MACD histogram bar and looks like we could see a positive MACD histogram soon.

Still long markets since 1305 and 1295 where I added and holding longs, follow me on twitter if you want to know some plays.

Have a nice day

Tuesday, April 19, 2011

Market view



Markets did a good sell off on some credit news of US yesterday - but markets did not sell off heavy as most of the selling pressure were on the gap down.

So did I cover my longs or what ? - No I actually added to my long positions at 1295-1296 level as I saw it holded very well today and now we just have an even BETTER inverse HS pattern than before.

Okay the left shoulders bottom were 1294-1295 and yesterdays bottom were 1295 perfectly. Look at the horizontal line , completley perfect touch , and a very nice rally or bounce after this touch. We made a hammer formation on daily charts on most indexes which is usually bullish. But if we move to below 1290 and lower I will most likely just take my longs of the table - but as I see it right now I think we have a good possibility to take out new highs by early May or end of April....

We will see how markets acts near term , as the short term trend is still down you gotta be careful doing the opposite , but SOMETIMES you need to take risks too to make big money and thats why I bought longs at 1295-1296 or "added" and then have a stop if we move below 1290 or so and watch markets. But until now we may very well have bottomed.

As I stated last week the dollar had HUGE OPEN INTEREST in calls , which is BULLISH.

The dollar is rallying very good with volume , that is the ONLY thing which worries me. FXE did hit my big trendline and stopped and moved down and the US looks like rally - thats not good for markets if the US dollar is rallying. So there is a good possibility I will stop out of my longs , but until then time will tell. This is just how I see it right now and I think it looks like a perfect INVERSE HS pattern.

Looking at IWM small caps they are back to the huge support trendline since September lows - if we BREAK BELOW this level , may get ugly , but if we bounce here thats a target for new highs comming, time will tell us near term but watch it...

The target of the pattern IF playing out would be in the 1360-1380 range, lets see whats comming next.

Have a nice day

Monday, April 18, 2011

Market view



Back from weekend in Norway and ready again.

As I stated in the latest blog post , if 1300 on SPX held which it did on Thursday , I got out of my short positions with good profits from 1333-1330 and got long the markets SPX 1305 via some small caps and other positions.

The reason were simply because we did NOT break below 1300 which I watched like a hawk and markets had strength enough to hold above , therefore my previous posts said to cover my shorts and get ready and go long.

For now I think we have some upside left and might see SPX to new highs over next weeks above 1344.

As I see it right now I think we may see 1350 next. The russels got a bullish MACD histogram confirmation on friday which is bullish for now and another sign that we may see higher levels near term.

Overall I am still VERY bearish markets longer term and by fundamentals - but the charts now tells me its better to be long for the short term. So profits taken from 1333-1305 in my shots which were very good and now got long small caps and other longs at 1305. You can follow me on twitter "Sqwii" as I post my trades.

There is a potential inverse HS pattern which may target us near 1360-1380 if playing out , but I dont think we will reach that level in the first run , but time will tell.

My target right now is 1350 by end of April early May and thats how I play it for now.

IF markets is going to reverse and move below 1295 short term I am going to take the loss on long positions , but until then I'm long.

Thursday, April 14, 2011

Market view



Markets did end up quite flat after a sell off for the whole weak , but imo a very weak bounce we got and ended markets nearly flat.

There are 2 possibilities for what I think now as indicated in the charts - if we dont close below 1300 I will most likely take gains of my shorts since 1333 and go long , but if we close below 1300 I am going to hold my shorts.

For now the short term trend is still down and TZA has been a big fat gainer of last few sessions.
There is a potential inverse HS pattern setting up , which is very bullish and thats why I am probably going to take profits if we dont break below 1300...

2 counts on my chart the green and red. Right now the trend still remains down and I have not got any buy signals , so I would continue to short until otherwise.

The critical area in IWM chart is at 80-81ish level , watch this level closely , if we get there , watch if we get a lot of buyers comming in ( then probably bottom ) if not , we may have a fast and big sell off....

Big trendline support from september lows there , note that the small caps has been hit harder than overall markets recently.

I wont be here as I am going to Norway over the weekend , so going early off for weekend - but watch those levels or maybe stay on sidelines.

Will update on Sunday again

Have a nice weekend

Wednesday, April 13, 2011

Market view





Market did a very nice drop on Tuesday which I expected and closed below SPX 1320 - but we still need more downside and a drop below 1300 could confirm a bigger move down.

The question remains seen if we drop down to 1300-1307 or so and hold there , then there is a good possibility that we might see new highs above 1344+ , so I am watching this level closely - but I dont think markets did bottom yesterday , as I think we will see below 1310 and near 1300-1307 area support first.

The VXX also looks very bullish to me - and therefore I think VXX will breakout today or very soon - and with that I expect markets to drop more.

Another thing is that there were some BIG open interest in the dollar UUP yesterday and the FXE Euro touched the long term trendline which is drawed and got rejected from there. So the euro looks like a major top is in and a dollar bottom should be in with a reversal bar on daily chart. Someone is betting big on a dollar rally near term - who ? I dont know ... but lets see near term

So there are many things which leans me to be more bearish now with a very bullish VXX and very bullish dollar short term here and therefore holding shorts from 1333-1330.

If you look at the small caps they have been plunging down a lot more and TZA has been moving up 10-15% last days - very big move imho which I alerted days ago with charts.

All in all - holding my shorts and looking for more fear to move into markets as the VIX and VXX have not spiked up above 20 - when we see above 20 near term imho , we should see some more selling pressure in markets.

The question remains - do we hold above 1300 , making a inverse HS pattern which is very bullish and then move to new highs ? Or do we break BELOW 1300 - and then I think good possibility of seeing below 1250 ?

Time will tell near term, but until now the trend is down and remains down with the MACD getting more bearish. Watch out for the MACD histogram in small caps to change from down to up , and then maybe play a bounce in small caps as they have been hit hardest.

Have a nice day

Tuesday, April 12, 2011

Market view







Markets did another decline which has been even larger than last sessions , which is looking better for the bears. We will get the MACD cross today , so if we are going to have a lower low than 1250 , we really need a good sell off today on Tuesday where the bears needs to show up. If we keep hoovering above 1320 in SPX today , most likely we will see new highs - but if the bears show up on the bearish cross , then we might very well see below the 1250 target.

Small caps were down another -1% which has been moving down a lot last 3 days, good for those who are long TZA where I added when SPX were above 1333.

It looks like our triple and multiple bearish divergences is about to play out in markets as I have indicated some days ago which is usually very bearish.

What was interesting was the VIX was down big with the markets down - which is usually bullish cause no fear , but actually it might be very bearish signal BECAUSE when the VIX is down near -10% and markets not rally up 1-2% on such a big drop in the VIX , then seems like VIX could be about to run up from here and then the markets could be dropping hard. Who knows but according to history as big drop in VIX with markets down is usually VERY bearish markets short term , but bullish longer term...time will tell.

TZA were up near 3% yesterday, so another nice gain, lets see if we get some more upside in TZA today as the SPX is getting a bearish MACD cross. The DOW needs to take out 12.300 to get some follow through down in the markets , so watch that closely.

Looking at euro/usd to see when the dollar will bottom , we might very well be there or VERY close. A long term trendline is near 1.45 on the euro , and I guess we will reach it very soon (currently at 1.444) so lets see last push up in the euro to hit this trendlien and then plunge back down. With ALL the bad news out from EU , does not make any sense at all that euro has been climbing, but technical analysis tells us it want a touch of this trendline before a major drop is comming. At least watch 1.45ish area in the euro...

I wanna point out there IS a possibility that we are forming an inverse HS pattern , if the markets will stop near 1300 SPX and then rally up - time will tell us, but for now I'm still holding short and watching if we get some more bears showing up near term. The short term trend changed from up to down yesterday and gave a sell signal , lets see if we get some follow through to the downside on a possible Terrible Tuesday.


UPDATE INTRADAY :::: FXE the EURO HITTING RESISTANCE , MIGHT BE MAJOR TOP IN THE EURO HERE
Remember to follow me on Twitter - if you still wanna play some small caps on the long side.

Have a nice day

Monday, April 11, 2011

Market view





Markets did decline on Friday - as last week was a very boring week with no moves - but the biggest move we got was end of day on Friday with markets going down near -0.5% and small caps down near -1%.

But we have not got a confirmation yet that the down leg has begun - we need a follow through this week. We are about to get a lot of inflation data this week.

Markets is still overbought and we are about to get a negative MACD cross on the daily chart - which should give momentum to the bears again. The question remains then if the bulls are strong enough to hold the MACD histogram on daily chart above zero line - if so we might rally up again , but I still believe that this is the beginning of a leg down to below 1250 SPX. I would say the chart of TZA looks pretty bullish to me with a possible bullish MACD cross on daily chart today ( Monday or Tuesday ) - if se we could expect a nasty move down in markets soon.

Looking at the VXX chart it looks very bullish to me - why ? Its oversold now and over the last month we have seen big time volume here which (usually marks a bottom...) cause big money is buying and know whats going on... we broke the big downtrend since last year and started moving up, now VXX got a good pullback on low volume ( as you see on chart ) which is bullish for VXX and looks like its starting for a new leg up, time will tell, but either way technicals on markets looks very bearish to me right now.

We should see the bearish MACD cross in the beginning of this week ( Either today or Tuesday ) so lets see if we see a follow through to the downside. My plan is to remain short 1333-1330 still and hold as long we dont break above 1344. If we breakout to new highs in SPX I am going to take the loss - but until then my target remains we see below 1250.

Thursday, April 7, 2011

Market view






Portugal asking for bailout now, with a euro rally yesterday - how sweet it sounds. Guess we need more countrys out there to ask for bailouts to make the euro rally higher ;-)...

Overall markets had a VERY good reversal day yesterday as we touched 1340 SPX early trading and then reversed down too red zone , until they tried to hold markets up again at the end of the day. Markets were up 0.2-0.3%...

Well today and tomorrow should be the days were there will be some ACTIVITY in the markets - cause it has really been a boring week ( either consolidation before breakout higher ) or topping formation before plunge.....

The ECB is going to hike rates by 0.25% which is expected - Portugal asking for bailout 1 day before ECB rate hike , somethings up ?? Do they want to raise the rates as a country in EU cant even handle the low rates now ?? And now they are going to RAISE rates ? Oh yeah - sure we have growth I forgot and we need to raise rates cause we have growth. That is NOT the reason , but only because of high inflation, so question is today - do they want to raise the rates as Portugal needs bailout ? I think euro will sell off if they just hold the rates as expected - but they need to signal higher rates in the future to make the euro rally higher.

Tomorrow we have a deadline of government shutdown in the US - and they are talking about a 4billion cut or so ? They cant agree on a little cut of 4Billion , when in reality they need to cut some TRILLIONS guys.... comepletley insane, 4 Billion is lower than 1 day in POMO action which is near 6-8 BILLIONS.

If you were sick and went to the doctor and the doctor said to you , I will give you a much higher dose , do you think you are healthy then ? (Like QE1, QE2) - if the economy is good , why are they spending more than DOUBLE the amount like last time , just to hold markets up ?

Okay enough about the real fundamentals - but Spain may be the next to get bailout and there is not enough money for EU to bail them out...

Not much to say , still looks like SPX backtesting the broken trendline , very overbought now and the volume is decreasing with bearish divergences on 30 min and 60 min chart - will it play out ? Thats what I think and I have a target of near MA(200) test at 1200.

China (FXI) and Brazil (EWZ) looks very bearish too

So overall I am still holding big shorts at 1333-1330 and thats my plan - if we take out SPX 1344 I am FORCED to take the loss , which is sad , but true - so if SPX making new highs I will take the loss and play the bubble up...


Have a nice day

Wednesday, April 6, 2011

Market view




Yesterday we closed pretty much FLAT another day in a row - very boring days without no action in general markets - it might be some sideways consolidation before moving higher, who knows? But the 30 min and 60 min chart still have bearish divergences which is very bearish and the volume is drying up from the rally 1250 , which indicates its getting exhausted.

But one thing is for sure - this slowly grinding up , reminds me a little bit about what we saw in September and up. Slowly 0.3-0.5% up everyday with a little gap up. But if I am right we should still see a move below 1250 and thats why I am holding shorts from 1333-1330 and not letting it up , only if we break to new highs SPX I will stop out and take the loss as I think in 1 day the trend can change very fast as we have seen and erase the gains in just a few days.

We have ECB rate hike tomorrow (Thursday) so this will be a big event which will move markets a lot imho - I think the rate hike is priced in already and Trichet needs to tell markets that he is going to hike rates in next 3 months again to cure inflation - if not the euro will sell off.

The funny thing is that many people think that rising rates is a bullish signal for economy and that the economy is on the right path - but this is NOT the reason , the reason is because of HIGH INFLATION , not because of high growth.

Portugal really needs a bailout and the yield they said that the ycould pay was below 7% , now its getting near 10% which is extremly unsuistainable and a possible deffault in Portugal may come , cause they dont have any government yet before june.

Some interesting things on SPX is that the MACD histogram is ticking down and MACD histogram on Nasdaq is already ticking down , which shows a reversal should happend. 30 min chart and 60 min chart still bearish divergences all over this rally since 1250, so lets see if they play out.

And lets take a look at the euro/usd - this keeps moving up also with recent BAD news from EU that one country about to deffault and growth is slowing and high inflation - but who cares cause its running by big boys and manipulation - so lets take a look at the technicals in the euro/usd.

The USD broke down below the big support which is actually bearish , but looking at the EURO I think the euro may rally to 1.425 (trendline resistance or 1.45 ultimate target) thats a weekly trendline resistance. Maybe they all had a target for this area before let the euro move down ? time will tell. In the end the euro will most likely fall apart- cause we are in a moment now , where EVERYONE try everything to cure not a disaster with giving bail outs and so on. But in the end ( I dont know 1 year or 2 year or some monts ?? ) but countries like Greece, Ireland, Portugal and Spain will deffault. Ireland have a a external debt to GDP ratio at 1124% which is HUUUGE! No way they can pay it back to countries , it would take like 100 years or more if they should be paying back and cutting down too, simply impossible. They have an public debt of 111% of GDP and is rising..
The same goes on with Spain a 162% external debt to GDP. Spain has the highest unemployment rate above 20% and with that in mind , it seems impossible to both cut in debt and have growt and fewer unemployed. Its just too sick and Ben Bernanke think we have growth just by lookin at SP500. Well YES BENNIE , you made a GROWTH with your QE1,QE2,QE3 fantastic !! But where did the QE money come from ? US taxpayers !! So right now what is happening is that he is stealing from poort and middle class , by using money to prop up markets and then letting the USD falling and making the purchase power less for each consumer as inflation is rising. I know this is a bubble and its only a matter of time again with the euro and also US going into the greatest depression - cause this is an all time assset bubble.

The fundamentals behind it is sick - seems like Ben Bernanke think by having more and more debt by propping markets up and wall street ( without main street ) then the economy is on track, but after this they also need to withdraw this money , how will they do it ? who is going to buy it all ?? This is simply a sick policy to push billions of dollars to have a "slow growth" , after they will pull out to have a big depression cause they are going to loose jobs and growth when they need to cut back AND rise rates....


But all in all - remain heavy short from 1333-1330 a bit under water now , will take the loss if SPX makes new highs , but until then holding

Have a nice day

The leg down comming - should be more bearish than we saw in March and we should see below 1250.

Tuesday, April 5, 2011

Market view



There was not much to say about yesterday , pretty much flat and a boring day with no changes to the analysis - that a big move to the downside should be comming and a breakdown. We are still in the rising bearish wedge with more than a triple bearish MACD divergence , which indicates that this rally is "overdone". But again - who knows if they are going to run the markets to SPX 1420 or so ? - Well in that case I am going to take my loss on shorts at 1340-1344 if we move to new highs , cause I wont be on the long side if we do that.

But all in all , volume light and many bearish divergences, what to come ?

Overall daily chart on VIX looks bullish here more than bearish and the SPX chart looks very bearish at the moment.

We have this weeks biggest event in EU with a rate hike on Thursday - its already priced in , do they have more rate hikes in pipeline or what ? If not - EU will sell off imho and USD will rally.

Also on Friday we have something BIG event with DEBT , as in US they must find something to raise the debt limit.

Overall there were some big fat buyers in the SPY put volume on Monday - so I dont know if the big boys know something we dont know ? Time will tell - but may come some very interesting things over the next 1-2 weeks.

Sunday, April 3, 2011

Market view






Markets did another minor uptick but retraced most of its gains near day end on friday. Markets did go above my original short positions at 1333-1330 and I added to shorts when we traded there. We are still in a very steep bearish rising wedge and a breakdown of this should take us lower next below 1250 SPX. I still believe we are going to take out the 1250 and the copper is showing a clear HS pattern where it will breakdown of it soon.

If copper is any leading indicator watch out for markets to fall down this comming week. We have ECB with rate hikes comming this week, not much economic data , but everyone has priced in a rate hike in EU, so might be a sell off after news.

Also watch MENA countries , Japan and comments to QE2/QE3 which could make the dollar breakout and the markets breakdown.

Overall still heavy short and markets did close below resistance 1333 and we closed 1332 - that was not bullish for the bulls as we did not close above the resistance, but below. We should start already this monday with a nice decline. The VIX made a hollow red bar , which is bullish and a start of a new uptrend. Markets overbought again and the VIX got oversold on daily chart - ready for another move higher.

30 min chart still a TRIPLE bearish divergence if not 4 times.. MACD making higher highs 4 times but MACD 4 times lower lows - that is VERY bearish. VXX have a triple bullish divergence also telling that fear should come into markets again.



Keep a close watch on thet bearish rising wedge - cause when we break below the support we are on the way back below 1250.

Have a nice week