US equity indexes closed moderately lower, sp -3pts @ 2115 (intra low 2107). The two leaders - Trans/R2K, settled lower by -0.2% and -0.6% respectively. VIX settled +4.0% @ 14.64. Near term outlook offers pre-FOMC downside to at least test the double low of sp'2085.
A day of moderate weakness, but clearly.. nothing of any significance. Even a move to the recent low of sp'2085 looks out of range until early next week.
VIX remains broadly subdued, stuck in the mid/low teens, and it will likely take a break of the sp'2025 low to see the VIX test the key 20 threshold.
Another day closer
The BREXIT vote is just two weeks away. The count will begin at 10pm BST (5pm EST) on Thursday June 23rd. The result should be clear before the close of US trading on Friday 24th.
Yours truly has the following ballot paper sitting on his dining room table.
How will the UK populace vote?
By definition, the UK populace lean on the conservative side of things. They don't much like change (even when its for a better outcome), and will be more inclined to vote to remain in the EU. However, the movement to leave is unquestionably more motivated and arguably... more inclined to vote.
The vote will likely be pretty close, with the outcome important not just to the UK equity/capital market, but to the wider EU.. and to a lesser extent, the US.
If the UK vote to leave, there will be at least some degree of initial upset/shock in equity land, and then its a case of whether that will be maintained, or whether the dip buyers will flood in once more.
If the UK vote to stay, we'd certainly see an initial equity relief rally, with the £ and € strengthening, and the USD cooling, with most equity markets rising 2-3%... on either the Friday.. or following Monday.
For the more conservative trader out there... holding long (or short) overnight Thursday will be fraught with massive risks (especially in FOREX land), but certainly... the vote also offers some interesting opportunities.
Goodnight from London