– The VIX has begun its journey back into positive territory, but may be making a deeper retracement than the existing one. The existing retracement was a respectable 43% at 19.38, but appears irregular. A 51% retracement to 19.02 would probably complete the pattern.
– SPY May be affected by end-of-quarter window dressing, as well. The first retracement was a respectable 47.8%, but because the market is so politicized, it must get the last nickel of gain. The 50-day moving average is at 133.72, a 53.7% retracement. I suspect that it may actually go a tad higher, but the 50-day appears to be the stopper by the end of day. After a 1-day wonder, the downtrend reasserts itself. This in no way changes my projection of a Primary wave  low on or around July 9.
(ZeroHedge) Equities did it again – and no matter what narrative a mainstream media channel needs to comprehend the monkey-hammering that occurs every second in our ‘market’, it seems a fat-finger 50k block of S&P 500 e-mini futures (or around $3.3bn notional equivalent) was enough drive the nominal price index up 1% to close the day-session almost green (and rather notably right at yesterday’s closing VWAP).
–UUP may still be headed for its Cycle Top resistance at 22.91 or its Head & Shoulders neckline at 22.93. However, tomorrow may be a Trading Cycle high that calls for a possible stiffer completion of the retracement which is already at 50%. It may make a further retracement to the 61.8% retracement at 22.22 or the mid-Cycle support at 22.19 over the next week. It appears that the initial sell-off of US equities may be coming from European banks. That means the dollars must be converted to euros to raise liquidity there. Thus, the further retracement in UUP.
– FXE fell away impulsively from its Head & Shoulders neckline. However, there is also a great need to “paper over” the losses at the end of quarter. As a result, we could see FXE retracing at least to its Intermediate-term trend resistance at 125.10 or even challenge the neckline again . I have never seen such a whacked-out market. However, that does not change my view of its next target. The one at parity, that is.
(ZeroHedge) Today’s edition of the Eurosummit is over. There was some news, however, as always happens, there is a twist:
• EU LEADERS HAVE AGREED A GROWTH PACKAGE OF 120 BLN EUROS BUT ITALY AND SPAIN NOT PREPARED TO SIGN OFF ON IT – EU OFFICIALS – BBG
– TLT rose back to its trendline to complete what appears to be a double zigzag retracement to 52%. A new sell signal is issued once it crosses below Cycle Top support at 126.35. Thus far the action in TLT has been a tease, but the evidence is still bearish. A resolution to the downside may create a crash situation for TLT, thereby ending its Master Cycle decline at the Cycle Bottom support at 108.47.
– GLD is sending conflicting signals as it approaches its lower Head & Shoulders neckline at 148.53. The conflict lies in the fact that the upper Head & Shoulders neckline indicates a 96% probability of a drop to 142.26. On the other hand, the cycles suggest a bounce that, in all likelihood may occur at the neckline before the final plunge through it. Regardless whether it bounces at the neckline or not, the next tradable low may not occur until late July.
(ZeroHedge) It appears that finally after months of “being long of Gold in Indian Rupee terms” having proven to be quite a resilient and profitable strategy, the Indian state has also figured it out. And they are unhappy. Because to them, the key reason for the rupee weakness has nothing to do with the actual economy, and all to do with the Indian population trying to protect against currency debasement coupled with inflation: i.e., purchasing gold. And they will no longer allow it.
There goes another support for gold.
– USO made its first impulsive decline through its neckline at 30.80 and appears ready to bounce back to retest it and its Cycle Bottom resistance at 31.23. Most commodities are on the liquidity cycle and may not see a tradable bounce until early August. A retest at 30.80 will verify the correct placement of the neckline and the target it infers.
– FXI has bounced from its neckline and needs one more probe higher to complete its retracement. So far it has made a 43% retracement, but the pattern does not appear to be complete. Fibonacci relationships suggest a probable rally to 33.22, where wave a = c and a 59.3% retracement . One more push through tomorrow may complete the pattern regardless whether it makes this target or not.
(ZeroHedge) An unrelenting, horrid wave of scandals about toxic ingredients in foods and medicines in China shows that regulators are unwilling and incapable of controlling it. It also shows a penchant—some evil tongues say it’s cultural—for pandemic cheating in order to get ahead in some way. And Chinese economic data falls into that category.
– INDY appears to also be drawing out its retracement until after the quarter-end. It has found support at its Intermediate-term trend support at 20.40and may probe above its 50-day moving average at 20.96. An ideal Fibonacci retracement would be 22.14 to 22.26, but it is uncertain whether that target will be met. Its next Trading Cycle low is not due until late July or early August.
(ZeroHedge) The Business Standard of India reported this morning that the Reserve Bank of India (RBI) is likely to clamp down on gold bullion coin sales by banks as the rising bullion imports are adding pressure to the current account deficit and weakening the rupee.
– XLF may also be making a run up to its 50-day moving average to finish its minute retracement and its second quarter. The need to sell stock in this sector is especially urgent, so it would be no surprise to see XLF above its 50-day for a short while in order to attract unwary traders and investors. The overnight markets suggest another run-up in the morning. Don’t be fooled. The trend is down.
(ZeroHedge) McAfee and Guardian Analytics have uncovered a highly sophisticated, global financial services fraud campaign that has reached the American banking system. As this research study goes to press, we are working actively with international law enforcement organizations to shut down these attacks.
Unlike standard SpyEye and Zeus attacks that typically feature live (manual) interventions, we have discovered at least a dozen groups now using server-side components and heavy automation. The fraudsters’ objective in these attacks is to siphon large amounts from high balance accounts, hence the name chosen for this research: Operation High Roller.
With no human participation required, each attack moves quickly and scales neatly. This operation combines an insider level of understanding of banking transaction systems with both custom and off the shelf malicious code and appears to be worthy of the term “organized crime.”
One more reason not to trust the banks. Their systems are subject to cyber-attacks.
Have a good evening!
Anthony M. Cherniawski
The Practical Investor, LLC
P.O. Box 129, Holt, MI 48842
Office: (517) 699.1554
Fax: (517) 699.1558
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