Macro Week in Review/Preview June 2, 2012

• Posted by Greg Harmon
• on June 2nd, 2012

Last week’s review of the macro market indicators saw heading into the last week before the unofficial start of Summer the reality of a continued bearish bias as strong. Crude Oil looked better to the downside with Gold ready to head higher at the same time as global economic fears were growing. The US Dollar Index and Treasuries were looking to continue to strengthen with a chance that the Dollar Index consolidated first. The Shanghai Composite was now firmly heading lower in line with the crash in the Emerging Markets. The Volatility Index broke the pressure cooker to the upside and looked to continue to move higher. These influencers set a backdrop for the Equity Index ETF’s to continue to the downside. There was no disagreement or discussion this week. The charts of the SPY, IWM and QQQ whole-heartedly agreed with the downside bias. The only caution with global turmoil was to look for a reversal in the Dollar Index or Treasuries as a sign that the worst was over for equities.

The week played out with Crude Oil continuing the move lower. Both the US Dollar Index and US treasuries resumed their march higher. The Shanghai Composite found some footing and held a tight range while Emerging Markets also consolidated at the lows. The Volatility Index was steady early in the week before rising as it progressed. Gold along with the SPY, IWM and QQQ lead very uneventful weeks, holding steady over support, until Friday that is, when the bottom dropped out for Equities and Gold did a moon shot higher. What does this mean for the coming week? Lets look at some charts.

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