US equity indexes closed moderately weak, sp -10pts at 2564 (intra high 2578). The two leaders - Trans/R2K, settled lower by -0.3% and -0.8% respectively. VIX settled +11.0% at 11.07. The gap zone of sp'2474/61 remains a technical necessity, but until last Thursday's low of 2547 is taken out, the bears have no right to be confident.
US equities began the week on a mixed note, with a quartet of index historic highs (if only fractional) in early morning, but increasing weakness in the afternoon.
The daily candle was of the bearish engulfing type - breaking last Friday's high, but settling below the Friday open. This is a rather bearish signal, and could finally mark a s/t top. To be clear though, rising trend from 2488 is still intact, and unless we break last Thursday's low of 2547, I don't think equity bears can be remotely confident that a 4% cooling wave is underway.
Market volatility remains broadly subdued, with the VIX settling the day in the low 11s. First soft target are the mid 12s.
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Goodnight from London
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