ETF CORNER

SPY vs XLU

DBC : "Delicate Bounce Coming" for commodities ?

DBC (Commodities ETF) Could find some support here. If there were to be a bounce I would aim for $22.50 with a protective stop @ $21.45.

The ice is getting thinner !!

Now that the three main US indicies have rallied massively throughout the last few months,it comes as no urprise that the ice is getting thinner !

The four ETF that i have under the radar screen are crucial as they will determine the direction of the broader US market . They are getting close to their support levels ! The tinted red areas on the 4 charts show the "margin of safety" ! If DBC(commodities),USO(Oil),FXE(Euro) and GLD(Gold) break their respective support lines (which they will do simultanously), then the markets are in for  new major downleg. If the support lines do hold, then there could be a final push higher before the big plunge ! In both cases there will be a be a big plunge .. it's only a question of when ! The support lines will be breached !

I've added on the charts the following symbols if you wish to play the bounce, or the breakdown !

GLD: DZZ(Double short GLD); DGP (Double long GLD)

 USO : DTO(Double short USO); DXO(Double long USO)

 FXE: EUO(Double short FXE); ULE(Double long FXE)

 DBC: CMD(Double short DBC); UCD(Double long DBC)

Is it the end of the Cyclical Bull market of 2009 ?

Last week I have warned of what would happen to the S&P 500 if the EUR/USD dollar failed to breakout (Click here !) I think that we might have reached the top of this "monster bear market rally" (cyclical bull market within a secular bear market) called it whatever you like. One main observation is that The US indicies have failed two weeks in a row to break above major fibonacci levels. Nasdaq (.500 ret) Dow Jones & SP 500 (.382ret). I remain short the markets with positions in FXP(double short China),FAZ(Triple short financials) and SDS(double short S&P 500). The pullback i was looking for in oil & commodities USO and DBC are coming to fruition (click here!) . Let's see if they can produce a bounce this week ! I'll be out this morning... will make a new post around noon time NY time !! Stay tuned .. it's going to be an interesting week !