New moon today, and a seasonal geomagnetism (inverted) peak around now:
Sunspots have been rapidly waning too.
Price action in US equities has been up and down this week, but there has been a more pronounced trend change in European indices. Meanwhile, precious metals have consolidated their breakout and treasuries have advanced again.
Utilities continue to outperform and at the end of Q2, YTD sector performance looks like this:
Which fits with this:
Bears have largely capitulated, as evidenced in readings in Investors Intelligence, NAAIM, Rydex, and more, whilst complacency is extreme, as evidenced by put/call ratios, Vix and more.
Cyclicals to utilities, high yield to treasuries and Dow-gold ratios have all turned down again, signalling risk off:
Several Sentimentrader charts are signalling a trend change:
The US indices are ideally placed to turn, with the Nasdaq Composite at a double top, and RUT and IBB at potential lower high second chance peaks.
Equities have frontrun a return to ‘normal’ growth in both the economy and earnings, yet neither are occurring. Earnings season beginning early in July has the potential to add to the GDP disappointment and help cement the doubt and feed a downtrend.
To add to all the above, various divergences and indicator flags are mature. I maintain the reason for price advancing despite all these headwinds is the solar maximum driving speculation. If price continues to advance from here then I suggest the solar maximum isn’t done. However, evidence still points to the smoothed max likely being behind us, befitting peaks in markets spreading from December to June, around a Feb/Mar centre. If so, equities are ripe to fall here and deliver the potential of the combined above set-up.