It is early in the morning.
Asian markets were down overnight. That was to be expected since the U.S. markets were down yesterday. What got my attention this morning were the european markets. The FTSE (London), CAC (Paris), and DAX (German) markets are all down and by respectable amounts. The european markets could indicate the direction of today's trading in the U.S. markets. Today feels like a day where the open could be the absolute high of the day.
Conditions are bearish. I noticed that the mainstream media is beginning to pick up on and report about the market drop. This shows a point of recognition, a common feature of markets in the middle of a Third Wave of a Third Wave down.
After reviewing a weekly chart of the S&P 500 Index, I can see a pattern in the stochastics. The weekly stochastics has bottomed on or about July 1 since at least 2008. This pattern tells me that there is a seasonable cycle at work. If this three-year pattern holds up, then it is most assuredly time to get short ASAP. Lower prices are ahead.
The stochastics on a daily chart remain embedded. This Third Wave of a Third Wave is just beginning. There is no panic in the streets. Quantitative Easing 2 ends on June 30. The Greek debt crisis is returning to the forefront. Together these factors suggest intense downward pressure on the markets in the next two weeks.
Let's see how the day unfolds....
Wink
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