Macro Week in Review/Preview June 29, 2012

Last week’s review of the macro market indicators saw heading into the last week of the second Quarter looked for Gold and Crude Oil to continue lower. The US Dollar Index was poised to move higher with US Treasuries continuing to consolidate with a slight downside bias in the short term. The Shanghai Composite looked headed lower while Emerging Markets continued the bear flag in the broad consolidation. Volatility looked to remain low keeping the bias higher for the equity index ETF’s SPY, IWM and QQQ. The view on Crude Oil contradicted this as Oil and Equities have been correlated, and a move higher by the US Dollar Index or especially Treasuries would likely bring Equities lower. Despite this the charts for the SPY, IWM and QQQ all showed a short term upside bias within consolidation on the weekly view.

The week played out with Gold falling to support while Crude Oil ran along the bottom of the lower range before both launched higher Friday. The US Dollar continued higher while Treasuries continued the consolidation, before both were knocked back Friday. The Shanghai Composite worked lower while Emerging Markets broke the bear flag lower before rebounding Friday. Volatility bounced higher before also dropping back to end the week. Th mixed signals played out in the Equity Index ETF’s as they moved sideways drifting lower until a major Friday rally led by the IWM. What does this mean for the coming week? Lets look at some charts.

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