MARKET COMMENTARY by Woody Dorsey:
NEAR TERM: Sentiment came in today at 97% Bullish (again, compiled after the close but before the Brexit results.) That sentiment behavior, given the strong rally and 7 days of short-covering followed by today’s shocker, is really confirming of the extraordinary market Vulnerability I have been talking about. Sure, Central Banks may save the day from being much more virulent but this is the beginning of something. The nominal idea of lower prices into the end of the quarter remains operative. Again, “there is no reason to be bullish here. Brexit is only a metaphor for Uncertainty.”
INTERIM TERM: The Top, on 6/8 “near 2120 remains, a great Risk level for stops. The market is in a Corrective Trending Function which has just begun. It will be a Long Summer.” I want to see the price pattern set up over the next few weeks.
The “Spank of England”
The “Spank of England” is a tell of an expected “Black Hole.” I had surmised, “The Brexit vote is only a Metaphor for Uncertainty.” The Brexit Vote results mattered less than the reality of an emerging structural Uncertainty in my Global Market profiles. That Vulnerability has now been revealed. I have been writing that a, “Black Hole” Environment was coming. This, “Spank of England” market response is not a major Low. It is the kickoff to a selling season. Yes, Central Bankers will likely provide another, not so invisible, helping hand. And, while they have proven to be overly facile, at solving some of the ephemeral market volatility some of the time, they cannot solve the Reality of all of the Corrections all of the time. Expect a dissembling of Central Bank Culture before this lawful corrective process concludes.
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