The Bearish Case
CRB chart bullish and through the BRL
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Last January, Greenspan said that low oil prices would be necessary to sustain a healthy recovery. Light sweet crude was trading at $18/barrel at the time. Since April, oil has been trading between 24 and 29/barrel. Today, it broke out to $30/barrel
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The USD broke down from high levels. Now forming an H&S pattern that looks to be completing the right shoulder with an inverted hammer.
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Dow 100pt chart broke a quad top and has advanced to the BRL. The BRL has successfully repelled these runs even though they have solid buy signals.
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SPX rising wedge on declining volume. Sept 2001 lows of 950 acted as resistance on this last run. Stochs at overbought levels. Weekly chart has inverted hammer.
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Naz retrace seems to be in play still....next stop, 1251....1000 by the end of october
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BPs have reversed up from the recent low levels only to reverse back down and set new lows. Using the 1pt chart, April 2001 is a good example of this.
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VXN doesn't have too far to go until it reaches all time lows....only 10pts from here.
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VIX in an area of support. Could get a bounce here.
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Mainstream media and analysts are all calling July 24th as the bottom. Vast majority of bears that I have seen expect a retest of the recent bottom to be the maximum downside. Might be time to really surprise the masses.
put/call ratio bounced of lowest low in 5 years.
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Check out the ascending wedge on the BKX P&F chart....
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Low interest rates stimulated consumer spending. This means that future sales were cannibalized and that the consumer now has less buying power and more risky debt. Any consumer driven rally is toast. |
