Bottom line for this week:
Three of the four US primary trading indices are in unusually tight, mature Balance Areas. This is a market condition highly conducive for a sharp break and the beginning of a trend.
Daily KRAs:
I’ve included both the bar chart and Profile view of the indices. Both present the same picture and probable outcome – a very sharp move.
Levels highlighted will be important for the foreseeable future. This is discussed in detail in the video.
SPX
NDX
RUT
DOW
Internals
Breadth, like price, is neutral.
VIX, just like price and Breadth, is poised for a sharp move. Pivot lows haven’t been formed without a VIX registering +30 since last January’s top.
VIX will drop if the indices break to the upside; it will increase if the indices break down.
Gold
Consider favoring longs in Gold against 1779.
Crude
Consider favoring longs in Crude against 76.79.
US Dollar
The US Dollar continues to break lower. Favor shorts.
US 10-yr. Notes
Favor shorts in Notes against 113’06.
