My sincere apologies for the last three months of silence, all the more as it was in such a critical -turnaround- moment! I was snowed under work and then took a long (and deserved!!) holiday.
In my early blogs, I wrote that we were at the last stage of the Bull market, and that the next big call was when to sell... Well, IT IS TIME!... The question is how to execute this, in other words at what level!
August brutal collapse was a turning point that took me be surprise! I have to admit that, though I was expecting Bear market in 2H 2011, I was not expecting it before indeces reached higher level! Well we will not see the previous highs before the next bull market
Key resistances have been broken everywhere! Markets will not recover soon from such a knock out... We are moving into another cycle:
Big bear is coming! Dont be fooled by any rebound: take advantage of rebound to SELL
EuroStoxx 50: Key support (2500) broken on the monthly chart.
Index is oversold, to rebound to 2350, then next resistance is 2500. In fact, there was a warning signal in June (Negative divergence, these type of signal rarely falter- see March blog on Emerging Asia that led me to sell & switch into Japan...).
Let's see how ESTOXX behaves at 2350, if broken 2500 will be the exit level.
Dollar Index: Oversold and stabilising at 74 levels, may test the 72 level corresponding to 2008 lows. The dollar has probably reached his lowest level. The currency to own (vs JPY, Euros) I reckon...The least bad among these three... Paper money is worth nothing ain't it?
Conclusion: We have seen the end of the 2009 Bull market, we should now sell on rebound at resistance levels (PS for the S&P 500 it is 1250).
For the courageous ones among you, shorts can be placed at these levels...For the long only among you, take your profit, and be patient, buy opportunities will come... Like in 2009!....I will provide update in the next few weeks...
Happy investing...
