Daily charts for S&P 500
Daily charts for NASDAQ
The indexes moved down as expected and all 3 indexes have broken MOBO support. As long as the indexes do not keep above the lower MOBO band for more than a day, we should see some strong downward momentum over the next few days. My first support for S&P is at the 200 day moving average at around 1110 and then my final support at 1050. I do not think the index should drop lower than that but we shall have to continue to observe the situation. The USD is making some nasty moves that I think should be a precursor for worse things to come.
USD index (UUP)
Daily chart for UUP
As you can see from the daily chart of UUP, USD gapped up and strongly broke fibo XOP resistance. Whenever I see such a strong movement, most often than not, we should see price coming back to test XOP (25.06) again as support before continuing the rally all the way to XXOP at 26.55, which coincidentally was the previous high reached during the panic of October 2008. If this Fibonacci setup on the USD plays out and reaches 26.55, we shall be experiencing a panic within the next 2-3 months.
Natural Gas (UNG)
Daily chart for UNG
UNG tested strong resistance at 7.68 and is currently coming back down. I am expecting UNG to bounce off its 50 day moving average at around 7.36 before turning up to make a high. I believe UNG is in the initial stages of a rally.
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