The Swiss team’s latest weekly tech view below. They are sticking to their call not to chase this rally but above S&P500 1535 it remains bullish but technically very weak.
They pick up on many of the same issues we have been seeing and commenting on in the forum, for some time. Continued inter market weakness, low volume, market breadth issues. They also pick up on the vix divergence on the recent breakout high and also the over bought weekly indicators which are at extremes.
Some specifics.
SOX (SMH) failure. She’s at a key support today. On yesterday’s latest breakout they neatly pick up on the exact same comments we have in the forum pages ie health care and staples leading in the charge in the US indexes which is hardly a bullish indicator. They also belatedly pick up on the smaller & medium cap issue weakness in the russel2000 index that we have been noting for some time in the forum section.
They note the HGX false breakout. Let me repeat here, “from failed moves come fast moves’. Its a fascinating index to be short specific issues the housing index as many have moved to a price point beyond their 2006 2007 high water marks yet housing volumes are very light by comparison to prior boom conditions. (As we have commented, it appears participants may have got way ahead of her self on housing related issues. And where housing leads the consumer tends to follow ie consumer discretionary will follow).
Correlation and inverse correlation instruments. The USDJPY has recorded a trend break, which again we have picked up and this is dangerous for the nik225, etc. Em indexes small bounces but the highs of their rallies where recorded back in feb, in the main. The AUDUSD has continually failed to breakout and the commodities remain weak with copper, a key cyclical instrument showing great weakness.
There are so many independent pieces of evidence here. Its a strong case that we are within days of near term market top. Unlike the team my own work does not produce such a clear indication as whether this is the top for the year or whether it is a near term top only ie with one move large bounce to follow later into q2. On an extended fall in the indexes i will be on the look out for clear evidence across the usual tech indicators for a base in price in the key sectors like finance, housing, tech and the industrials as well correlating international instruments. On a high degree of confidence take the entry and then see if she runs. Its as simple or complicated as this for me. We have had a bull market in equities for the last 4 years or more. The failure of this bull shouldn’t occur in one move over night. This seems entirely logical to me especially as we have late reversal of fund flows who will be looking for entries to belatedly enter this equity market.
Lastly the team remain bullish the bullion even should the prior low be found at 1555. I’m sitting tight on my bullion. The commercial shorts are at ten year extreme positions. Should a short squeeze occur it could be a significant market event.
Here the report: http://www.capitalsynthesis.tech/wp-content/uploads/2013/reports/UBSTAWeekly03-04.html
Apologies to non flash users. The report is in a flash format this week.
Also here the German tech view of the bullion market from Tuesday. There is nothing new here. We all know these levels clearly as does the entire market. Nonetheless its always interesting to here their views if only it re-confirms that many in the market are using the same levels.
Report here: BullionWeeklyTechnicals02042013
And a new report here which is the Swiss team’s run through on the major fx pairs. I’ve been tracking for a while and its a good report so it might become a regular. Usually at the start and end of the trading week their comments extend a further than the day view which is the useful bit in my view hence i post up here yesterday’s report as the start of the European trading week.
Report here: fx-02-03-13
The devil is in the detail as always. So lets continue this on the forum pages.
I encourage everyone who reads these reports, of which i can see are over 300 unique visitors a day, join us on the forum pages to share practice and knowledge. Its to all our advantage to do this.
All the best
Rich
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