Netline has been violated and closed above at 1372. A new trend has been established and confirmed. Irrespective of what data is released, the year scond half rally has now been set in motion. Capital3x subs knew about this when we mused about this at 1328 if ES was readying for an almighty rush to 1350 and then 1372 which to our surprise was achieved within 3 days of our saying so. Where do we go from here? Simple! UP. Give space for one last dip to 1351 post which will come with massive bad news but fear not! Consider those to be buying opportunities. Under 1339 (Netline sell), things become cautious again. This is how markets move. Once they set into motion, they dont give you much chance to enter which is why it is important to position one for a move.
Gold is looking set to advance as it breaks free of its resistance zone at 1616/20 and is set for an advance to its upper BB25,2 at 1639. That is also weekly confluence zone. Above that level, there is nothing but air and hence expect that level to hold for now before another late August rally to push it way into late 1600's on expectations from Ben printing press. This is the first time since March 2012, Gold has closed for consecutive days above the mid line 25,2.
AJ is bracing for a move to 82.74 as it hits the net line at 82.35/40. Vital moments for those holding shorts. Above 82.74 AUDJPY is looking tipping over into space with nothing to hold it back as it could race away to 87 levels.
The story of CADJPY is similar to AUDJPY as it to battles its Netlines at 78.2. A break will mean 79 into play and also a further push for ES. CADJPY and AUDJPY has been leading this risk on rally as they almost always has been.
How bearish does the break of the multiple Netlines look? 82.97, 82.95 and 82.94 all gone in quick succession and the dollar index closes below 25,2 BB mid line and now trades at the 50 DMA 82.833 level. Can we pull in a quick ret to 83.22 underside of the mid line 25,2? Notwithstanding any rets, the dollar index looks ready for a fall to 81.88 and 81.5 levels. This could be a clean fall as EURUSD poises itself to test 1.247 and then extend to 1.265 levels.
The EU bunds have eased below 25,2 mid line which is what has set the ball rolling for global risk markets. The risk trends have since then pause as we expect a ret in bunds after 5 consecutive red candles which is a record for 2012. The pace of this fall will reverse at some point which we think is around the 50 DMA at 143.35 for a restest of 144.27 which will also help ES to ease back to test the broken Net buy line. The daily stochs and vortex oscillator have almost reached neutrality zone and hence it is time to cut down all positions to a min as we wait for stochs to fall back below 30 and Oscillator Vortex to fall below -1.4 for us to go big time long on ES and risk markets.