1. The expected pullback of the SPX and NDX is about to reach the targets of 1300 and 2280 respectively today or within this week as the Mercury retrogade makes short term evaluations tougher. NDX defended the gap yesterday but the SPX close rather hinted to more weakness as it also did not reach the target yet. Mars has left now the distress pattern with Pluto but will within a few days enter a new one as an opposition to Saturn is due. The chart picture of Google looks anyway weak so I rather expect a disappointing news which should bring some after hour weakness. Today weakness comes rather from Europe as Greece goes for the bankruptcy of the bankruptcy slowly and interest rates are reaching slowly real value levels.
Gold is tentatively higher against the euro but mixed against other currencies while silver is again higher against most currencies. Both probed higher this morning and are exhibiting signs that they may push higher prior to a much anticipated correction. The Greek 10 year yield has just surged over 13.2% and this is leading to falls in the euro and risk aversion with equities, commodities and oil falling. Both gold and silver are less than 2% from their record nominal highs seen Monday (gold all time and silver 31 year) and are remaining firm due to concerns about the U.S. dollar, the euro and sovereign debt issues in Europe. While markets are not focusing on geopolitical risk in Africa and the Middle East and the Japanese natural and nuclear disasters, these problems remain and will lead to continuing safe haven demand. Silver’s resistance is at Monday’s multiyear nominal high at $41.95/oz. In normal circumstances profit taking would be expected near $42/oz but this is anything but a normal market due to the existence of massive concentrated short positions being investigated by the CFTC. The dollar’s fall suggests that markets are skeptical of Obama’s latest budget proposal to cut $4 trillion off the massive US budget deficit. The US fiscal situation continues to deteriorate week on week and month on month which could potentially lead to sharp falls in the dollar in the coming weeks.