Macro Week in Review/Preview June 22, 2012

• Posted by Greg Harmon
• on June 22nd, 2012

Last week’s review of the macro market indicators saw heading into the Summer Solstice there were a lot of markets at critical points. Gold seemed poised to move higher in the intermediate downtrend testing breakout levels while Crude Oil consolidated ahead of the next move, likely lower. The US Dollar Index looked to continue to pullback while US Treasuries were set to move higher. The Shanghai Composite and Emerging Markets were consolidating with Chinese Markets biased to the downside and Emerging Markets higher. Volatility looked to remain elevated but biased lower, making for an environment where the equity index ETF’s SPY, IWM and QQQ favored the downside. But their charts disagreed, with the indicators pointing toward the consolidation breaking higher. It was unlikely that both US Equities and Treasuries both move higher, although not unprecedented. A strong move by one would likely push the other in the opposite direction. Cautioned to keep a close watch.

The week played out with Gold failing at resistance and pulling back while Crude Oil did continue its fall. The US Dollar found support and reversed back higher while Treasuries continued to consolidate, holding over support. The Shanghai Composite broke its consolidation lower while Emerging Markets found resistance and is pulling back slightly. Volatility pulled back through support and found a bottom ending the week only a few points lower. The Equity Index ETF’s started their week with the charts in control, moving higher before a big set back Thursday erased those gains, and more so for the SPY. What does this mean for the coming week? Lets look at some charts.

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