acting-man.com / Pater Tenebrarum / June 30, 2015
Nothing to Worry About …
It was clear that stock markets would sell off and US treasuries would catch a bid on the news of the failure of negotiations between the former “troika” and Greece. What was less clear was that gold would actually fail to catch a bid, but we are putting this down to the fact that another surprise event occurred: the euro, after initially declining, actually ended theTRADING DAY slightly higher.
Some of this has to do with positioning: there were already lots of speculative shorts in the euro, and speculators added some 24,000 contract to their long position inGOLD FUTURES ahead of the weekend. When a big move higher failed to make an appearance, some of these positions in gold were evidently sold again, while euro shorts welcomed an opportunity to cover on a dip caused by widely unexpected news.
However, in spite of some brief displays of bravado early in the session, the USSTOCK MARKET did close near the lows of the day, with the DJIA losing 350 points. This isn’t really all that much anymore these days, in fact it is a move of less then 2% – hardly what one would call a “panic”. However, it did leave the average poised somewhat precariously just below its 200 day moving average and slightly below short term lateral support: