I will be on CLEAR CHANNEL DALLAS – KFXR/1190-AM And Streaming Live @ www.yorbamedia.com at 3:05 pm, eastern time on July 5, 2012.
One of the lead indicators for the Liquidity Cycle is the euro (FXE). It peaked on Monday, July 2 and has since declined to 122.97. A break of its prior low at 122.75 is imminent. Folks, FXE is now in free-fall territory and the Cycles project the decline will continue through early August for its first low of a series of deeper lows through early October. The minimum target for the early August low appears to be 102.46.
GLD is neck-and-neck with FXE with its retracement high also on Monday. It has a cycle low due in late July, with two more successive lows in mid-August and mid-September. There is a probability of a sizeable rally after the md-September low, but the bulls will be sorely tested until then. There are three targets on the chart, which may line up with the three bottoming dates that I have mentioned.
Today is the pivot day for equities. The decline doesn’t look like much, but equities quit making new highs. We are at risk for a 25 – 40% decline through early August in all equities. I hope you are prepared.
VIX made an extended bottom on Tuesday nad has stopped making new lows. We should see some evidence of the reversal more clearly by tomorrow. Monday may be too late for anyone who is long.
Most other advisors are calling for equities to go much higher, with a decline in the fall, after the election. Remember that the market is a discounter of the future. It may not wait.
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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