Bank stocks could lead market higher

If banks are leading down, bears are left short-handed

However, it always comes back to the same thing. The VIX. The only bit of planetary interference we will discuss in this particular space is the Mercury retrograde condition because it’s well documented and has just begun. For those of you who are uninitiated, Mercury is the planet of communications and if you have issues with the computer go easy on yourself. In terms of financial markets the characteristic most characterized by this 3 week period is volatility. Prices normally will undershoot or overshoot targets. But the biggest problem is miscommunication in any way imaginable. Mercury turned retrograde on Sunday but I think we’ve already had the premature effects. What I mean by that is the news is mostly bad, scandalous in fact. However it is not reflected in what people are willing to pay for an option as represented by the VIX. Something is not quite right folks. I’ve already shared with you the fact the time windows in October and at risk of being a broken record if we rally into October with a low VIX and reverse I will turn exceptionally bearish.

Euro bears get bearish because they believe the rumor mongers and short a decent market and are forced to cover. Here at Lucas Wave we allow the time windows to dictate how bullish or bearish we get. Since the 21 year cycle low on November 21, 2008 the markets have been good (given the bottoming process into March 09). But if we top in October you can argue it would be a 10 year cycle high. So we are 3 months away from this major inflection.

For now, I suspect we’ll see some wild swings soon enough. Since March our anticipation for a winding and grinding market has come to pass. Right now the bulls have a slight upper hand and mostly because of the decent action in Europe and banking/housing. The week will start this way but I would be surprise to see the bulls and bears get locked in a fierce battle where neither gets the upper hand in the near term.

stock, market, fibonacci

About the Author
Jeff Greenblatt

Jeff Greenblatt is the author of Breakthrough Strategies For Predicting Any Market, editor of the Fibonacci Forecaster, director of Lucas Wave International, LLC. and a private trader for the past eight years.

Lucas Wave International (https://www.lucaswaveinternational.com) provides forecasts of financial markets via the Fibonacci Forecaster and other reports. The company provides coaching/seminars to teach traders around the world about this cutting edge methodology.

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