Wednesday 27 May 2015

Daily Index Cycle update

US equity indexes closed significantly weak, sp -21pts @ 2104. The two leaders - Trans/R2K, settled lower by -1.5% and -1.1% respectively. Near term outlook is bearish to the sp'2080/75 zone. The mid term outlook is seemingly dependent upon whether the USD continues to climb... or starts to cool from the DXY 97/98s.



sp'daily5



Trans


Summary

*the Transports remains the key laggard. Next support is not until the psy' level of 8K, and that is another 4% or so lower.
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A day for the equity bears, the 50dma of sp'2097 looks set to fail on Wednesday... opening up the 2080/75 zone by Thursday.

Despite a bearish day, bears can't get genuinely excited until a breach <2040.. where the 200dma is lurking.

The giant sp' 2K threshold remains core support... all things considered (not least the ECB QE-pomo), I do not currently see sub 2K as viable in the near term.

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a little more later...