The week began on a significantly positive note, with the sp'500 settling +20pts (1.0%) at 2066.66. Somewhat understandably, some of the cheerleaders are again looking to much higher levels by year end. Yet, the market remains broadly stuck since the May'20th high of 2134.72.
*note a fourth blue candle on the weekly 'rainbow' chart. Equity bulls should be at least somewhat concerned that mid term momentum to the upside has indeed completely stalled - much like Nov/Dec' 2015.
So... it is indeed almost a full year since the historic high of 2134. It remains important to keep in mind that the 'old leader' - Transports, maxed out much earlier in Nov'2014 @ 9310.
What should be clear - even to the most bullish of maniacs, unless we see a clear break >2134, there should be serious concern that the market will be highly vulnerable to another wave lower.
Whether you aleady believe that could be caused by an adverse BREXIT voting outcome, underlying lousy earnings/growth.. or some spurious geo-political event, it really doesn't matter right now.
What does matter is that there is a broad array of problems... any of which would be a valid excuse to whack the US - and other world markets, lower by around 20%.
Tuesday will see CPI, housing starts, and indust' prod'
*Fed officials Williams/Lockhart are speaking together at a Politico event around 12pm, with Kaplan an hour later.
Goodnight from London