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Wednesday, June 22, 2016

Daily update 6/22

Yet another poll.

SPX was sitting just under the key 2100 level consolidating.  I was real curious to see what happened.  Suddenly it spiked to the downside.  I found out later there was yet another brexit poll and this one came in 45% exit, 44% remain.  That was enough to get the market to close in the red.  Today left an ugly looking candle pattern over the last few days, but today's candle might not really be reliable.  I really would  have liked to have known if SPX would have been rejected at 2100 again or not on its own.  Oh well.  The breadth was -53% after being up +66% at the peak of the day.  New highs were close to yesterday at 117. 

As I write this the futures are up about 10 points from the 4 PM close.  I don't know why.  Probably yet another poll.  At any rate they are currently above the 50 SMA they have been trapped under.  No confirmation of a break yet. 

 The green count dipped a bit today.  The bulls still have not reached out and grabbed the power. 

The short term bull pressure lines have a positive cross now.  That is one positive for the bulls. 

It is not hard to imagine the market retraces the news induced move down and SPX tests 2100 tomorrow.  It may be a tough nut to crack with the brexit vote going on.  We won't know the results until well after the U.S. close.  Downside follow through tomorrow will leave a pretty bearish looking daily SPX chart.  I would not expect that without some significant negative news.

I have no idea how the vote is going to go.  The polls are close.  A close vote to stay will not eliminate the talk.  The stay camp really needs a big victory and that just does not seem to be in the cards.  I predict Britain will eventually leave the EU.  The ECB is killing the EU economy with negative rates and it is only a matter of time before that is generally recognized.  I think plenty of people are already figuring it out.  Once the European economy crumbles they will not be able to threaten voters with the economic threat they are using now.  There will be no justification to stay.  Britain is a proud country and accepting all the crap from the EU is probably a tough pill to swallow.  I can't blame them a bit.  The U.S. would not do well in that situation either.  It is not a question of if they will leave, but when.


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