IIFT Daily Note with Peter Brown

Correction underway and gathering steam.

Posted by:  |  Time: 8:04 am  |  Topic:  |  Comments: 3
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Well yesterday confirmed we are in a correction. Market has fallen 500+ points since Friday’s jobs data. 5/10% corrections are normal and healthy for markets. People take profit the market reset and we go again. Question is whether there is something more macro going on here. Certainly the froth has gone from tech stocks and there are questions over the economic recovery. We do not need to concern ourselves with that yet.

This market is in a down trend, now the question is how to play it. Expect a bounce soon. Prices do not move one direction only. We have come a long way so a 100 point bounce would be normal. However we can speculate at medium term downside targets. A 5% correction in S&P (JUN) would be 1795 and that is a good short term target. Remember the market will not be a free fall so expect bounces. This morning the market looks a bit too low starting off.

Conditions today are Choppy Levels are :- S&P (JUN) 1850  1832  Wall St (DFB) 16400 16200  DAX (DFB) 9600 9450 Euro 1.3800  1.3700

Gold 1325  1300 market is a sell on a bounce. Trend is down.

3 Comments

David

April 8, 2014

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Hi Peter
Is there a messy triple top forming in the DAX since the first high of 9790 in mid January. The bottom of the through is in the 9000/8900 area with a target of 8200/8100 approx.
Already correcting very nicely today. Great call by you yesterday to wait for the bounce and go short.
Regards
David

Peter Brown

April 8, 2014

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Hi David,

Agree with your tech points on the DAX. Hoped we would get a bounce early today as well.
Think the Americans will do it for us.

But overall sell on rallies this has still a bit to go.

Peter

David

April 8, 2014

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Hi

Yes I hope we find support around 9400/9390 and the americans rally us into the next short position. We are about to find out!

David