11 June 2020 – Big drop in the indices

Summary (The Week Ahead)
$DJT – DownTrend. /YM – DownTrend. /RTY – DownTrend. /NQ – UpTrend. /ES – UpTrend.

Indices upTrend continues.

/CL – UpTrend. /GC – UpTrend and in a Squeeze. /ZB – UpTrend. HYG – DownTrend. DBC – UpTrend.

Junk bond (HYG) and commodities (DBC) is in upTrend which is rather bullish for the market.

$DXY – DownTrend. EUR/USD – UpTrend. USD/JPY – DownTrend.

Market Internals
Market Sentiment – Bearish. Put/Call ratio – 0.924. Market Breadth – sloping downward showing more losers than gainer. Volume Acc/Dis – sloping downward and showing distribution. Vix –36.99. Vix Futures – 36.15. Skew – 131.29.

The indices sold off hard and we have a mixed indications of bullishness and bearishness. This means the market is at a crossroad. Bond market is in an UpTrend. Gold found some buyers and it is now above $1700 and is now in an upTrend. US dollar index continues to be in a downTrend. Market Internals are showing bearish signals. The prognosis is for a volatility as the market bulls and bears duked it out. Trade with caution.

Relative Strength – Sectors.

On a 3-monthly lookback, the relative strength order of the S&P ETF 500 sectors are /ES, XLY, XLK, SPY, SPX, XLU, XLB, XLP, XLV, XLE, XLI and XLF.

On a 12-monthly lookback, the relative strength order of the S&P 500 ETFs are XLY, XLK, XLV, /ES, SPY, SPX, XLB, XLP, XLU, XLI, XLF and XLE.

Indices/Indexes as of close of 11 Jun 2020

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