Classic Rock fans might wish to enjoy a little Guess Who whilst reading this morning’s post and picturing Angela Merkel’s expression upon seeing the markets awash in red this weekend.
With Greece seemingly irretrievably broken, the euro took a huge dump over the weekend. The SNB swooped in and propped it up, less the carnage be worse than it already was. The daily chart looks fairly benign…
…but, the hourly chart shows just how dramatic Sunday’s plunge (and, the subsequent prop job) was. Still — only a gap close, and nothing more. And, there’s plenty more downside potential to our 1.07 target.
Friday saw SPX reach the SMA100 as we anticipated [Friday’s post]:
And, today should see our next downside targets come into play, especially since USDJPY and CL have both clearly broken trend. USDJPY has broken below the red channel midline……and, CL has officially dumped the purple channel and is shacking up with the white channel we proposed on June 19. From Time to Pivot:
However, I believe the CL’s purple channel is about to fail. I expect the entire advance to pivot to the less aggressive slope illustrated by the rising white channel in the chart below. If so, the next stop should be a tag of the white midline (red dot.)
Not to worry, today’s move — and the subsequent drops we’ll see in the coming week — are all in keeping with our analog from this past March [see: A New Analog Mar 27, 2015]. We’ll explain.
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