Market view

Wow ! What a raly we have had over the past weeks.... QQQ up like 8 days in a row with about 1% in avg gain... thats really crazy and it really reminds me of the bull run we had late last year.... but the difference today is that we dont have any kind of QE now... are the big boys now trying to make people think markets can run like last year without QE ? Or will they just do this early July - before a big tank later on ?

** Updates chart with USO - potential head and shoulders pattern setting up too with target of 25$ on USO... thats a huge move down. If oil holds up here and dont move a lot higher we have a potential right shoulder setting in.**

Its really hard and as I've said before....... I dont have the CRYSTAL ball.... it came with a big surprise for me that this rally just continues and I'm sitting right now in big losses on my TZA trade from 34.69$ and holding all....

QQQ took out new highs , TRAN took out new highs - so I think my topping HS pattern is wrong - but I will still take it in my mind if we start to decline very hard from here...

So the action I will do right now is:

1. I'm really hoping of some kind of pullback - as its just really hard to believe that we will get such a big rally like last year without any kind of QE and at least a 2 or 4 day pullback after such a big rally should be expected. The thing is I hope that TZA could make a short term rally to around 34-35 and then possible get out break even on my trade - as it looks like SPX might take out new highs or get close to the previous high and then pullback befor it can take out the highs after a pullback.

But now you also understand why I said.... too much PESSIMISM in markets 2 weeks ago and why I went long TNA 68.8$ -- wow imagine if I were holding TNA still , but no one can predict the exact tops and bottoms.

I really did not think SPX would take out 1350 - were the MM's taking out the stops who did not think it could take out 1350 and then going down hard soon ?

To me UUP dollar looks pretty bullish and I still believe the dollar will breakout soon to the upside - which means markets should move down.... but last days euro has been moving down with the markets up - but most likely markets would fall down on a higher dollar.

We have bullish divergence still on 30 min and 60 min on TZA and other short ETF which means a rally is due - and we have negative divergences on SPY QQQ and others, and every single index is heavenly overbought..... long time I have seen markets this overbought - and also as I have said before - markets is ALWAYS stretching both to the bulls and bears side to make shorts cover and to make longs take a loss..... 2 weeks ago nobody really did not want to go long - today no one dare to go short..... its funny - but actually those times is often the best times to do it when you think its "crazy" to go long or short. Right now I have the feeling that it might be crazy to go short markets and other people would possible think the same, so it might be a great idea to get shorts now - but I'm already sitting in the red sea waiting for some kind of pullback.

Unemployment days usually if gap up - then sell off for the day , gap down then rally for the day.

So either way - I'm really hoping for some kind of pullback and a possible target is 1320 or 1315 if we want to run higher.

Markets looks a lot like a very BEARISH rising wedge pattern and right now we are in the end of the rising wedge which means a breakdown very soon should come. I will see how price/action in markets will do after this breakdown - if we get a -2% day , its quite strong and we might go down a lot - if we only get a -0.8% or so , then its just a little pullback where I plan to get out of my TZA trade with just a little loss or break even.

Overall I still believe we should go down over next 1 week but I have to admit this rally took me with a big surprise - so my plan is to cool off - wait out some more days and probably all next week to see if we get some kind of pullback as I can get out of my TZA break even or so.

Charts is telling me that we should breakdown and move down now - but markets just keeps going higher which reminds me a bit like late last year - but do you believe we will get such a rally without no QE ? Its possible - who knows... but I suspect it.

Remember today , a gap up would mean we likely close in red and a gap down mostly means we close green by statistics on unemployment day.

At last - I wanna share you one of my FAVOURITE indicators or tools out there which is excellent on swing trade positions and that is the Bullish percent index with an EMA(10). This gave actually a swing trade sell signal early May and have been on sell until 27th June. SPX were 1370 early May and around 27th June around 1280. Thats a big profit you would make on these signals - you could probably try them out for swing trades - and if this is reliable its still on buy signal until it moves below EMA(10). You can try it out and see how it works for you - but I find it pretty good overall - remember nothing is 100% right.

Have a nice day