1. Nadal podkreślam, iż rozpoczęliśmy długofalowo spadki (I poł 2012 - koniec?). Nie będzie teraz żadnego QE3 (dalsze drukowanie pieniędzy) 2. Obecne wyprzedanie rynku i bardzo negatywne odczyty nastrojów inwestorów, w tym opcje, skłaniają do wniosku iż zbliżamy się do czysto technicznego odbicia 3. Docelowo schodzimy na niższe poziomy - jakie? Zobaczymy po sile spadków 4. Nadal kluczowe instrumenty (miedź, srebro, złoto, DAX, i wiele innych) znajdują się nad ważnymi wsparciami więc możliwe że spodziewane techniczne odbicie nastąpi z tych poziomów
Sentiment Hitting Contrarian Territory!!
Sentiment Hitting Contrarian Territory!!
- US Trading: The technical picture is unchanged negative with short-term downtrends intact and daily/weekly price studies in short mode. After breaking 1294 the SPX is taking aim at our favored 1249 target projection. However, with most headline indices heading into strong support the current decline is moving into its final stages, so we shouldn’t be too far away from an important tactical low. Short-term we still see the risk of overshooting into expiration; before next week we could see a more significant bounce starting as the first part of our projected June trading bottom. Consequently, we see further weakness into next week more as a buying opportunity instead of chasing the market lower!!
- The market sentiment is hitting contrarian levels!! Last week we saw the biggest single day spike in the CBOE put/call ratio since December 2008 and the AAII bullish consensus hit its lowest level since the July/August 2010 bottom. What is still missing to complete a contrarian buying setup is the ultimate capitulation session with spikes in volume and fear indicators. In the bigger picture we see the increasing bearishness as the basis for a significant tactical rally into late July/early August!!
- US Strategy: With the overall momentum deteriorating and selectivity increasing we have entered a larger, distributive top-building process that completes the 2009 cyclical bull market. From the May top, we expect a first stronger correction leg of 10% to 15% into Q3 to mark the start of a six- to ten-month cyclical bear market ultimately into H1 2012. From a cyclical standpoint, June should be weak for risk assets, whereas in July and into early August we expect a significant tactical bounce/counter trend rally.
- European Trading: The Euro-Stoxx-50 posted the sixth negative weekly candle in a row and further technical damage on the index front was triggered by extending the current correction in banks, retail, technology and construction, whereas chemicals, utilities, autos and real estate are still the stabilizing factors in Europe. On a shortterm basis we still see the risk of a final wash out into next week but given the fact that we are moving into the time window of our late June low projection we would use further weakness to buy and position for a rally/counter trend rally into July.
- Inter Market Analysis: Last week’s bullish USD reversal is in line with our cyclical models and sets a higher low versus its early May low. As long as the DXY trades above last week’s reaction low at 73.50 (tactical stop loss for USD longs) the USD is in tactical bull mode and from a cyclical perspective we continue to see a higher USD into later June before a possible new down test into July starts.
- Although the correlation of the USD versus the risk trade has been weakening, we have no evidence of a fundamental break of the correlation. Consequently, from a cross asset class perspective we see a higher USD as latently bearish for risk and in particular commodity themes. We continue to see precious metals vulnerable for another tactical down move into later June.
- A higher USD would also suggest more pressure and relative underperformance in emerging markets. So on a very short-term basis we see most of Asia and emerging markets still vulnerable for a final overshooting into a later June/early July low before starting a meaningful tactical rally into late July/early August. Aggressive accounts we recommend buying into further weakness.