Greece’s Next Move
Bounce in the market today, the S&Ps rallied and closed near the 2071 level after trading down to 2050 yesterday. As of midnight last night Greece did not make its payments. At 4-5 in the morning Greece said they would consider the International Monetary Fund’s plan, incorporate the cutbacks, but have a couple things they want to change with the plan. Midday Merkel said no to Greece’s stipulations causing a decline in the market. Then market then rallied with the hope that something would happen between Greece and the EU. Unless there is a huge plan for Greece I don’t see this situation causing the market to go up. Sunday there is a vote in Greece whether or not they want to remain in the Eurozone. The market is still down for the year, there was a brief 138 point rally but I have a sell signal on the daily charts. I am seeing a sense of complacency with people expecting the Federal Reserve IMF and the banks to come in and fix everything. I don’t see things getting better. I believe the market will push down into new lows for the year before a rally in the 3rd and 4th quarters. Market is going to be very choppy the next 6-8 weeks, sell signals on daily charts for the ETF SPY, S&P futures, DOW, and Nasdaq ETFs. I am looking for another day and a half of a bounce before some sort of short signal. I am waiting to see the job number being released at 8:30 tomorrow morning. Unemployment was up last month but there are claims of more and more jobs, I do not believe these numbers. Oil was down over 2.50 today, I am not bullish on crude and there is significant overhead resistance at the 61-65 level on the weekly charts. The oil stocks deteriorating was a clear sign that oil would follow. Oil needs to close below 57.69, closed today 56.85. Oil is negative on the daily charts, I expect 1-3 days of a bounce before it heads to the mid-high 40s. I am not bullish on Gold. Gold was down today and did nothing even with the Greece news. I have a sell signals on the weekly and daily charts, a bounce would more likely be a short than a buy, trading in the 1140-1185 range. My course Pattern Recognition 101 is almost complete and I will keep you posted if anyone has any questions please call 203-617-4026.