Greek and Euro Group death ballet and stock market

Posted: July 2, 2015 in crash, greece, stock market

Definitely there is a lot of complacency in the market, mostly due to our propaganda filled media.

– PM Tsiparas is doing a ballet…saying to the Eurocreditors (Euro Group) that he will be more lenient and accepting their requests and play the hard core rebel with the Greek voters

– The media push amazing YES vote in polls….and if you look into the polls the sample is just 1,000 persons in Athens and the difference between Yes and No is irrelevant (5% within statistical error)

-The Eurogroup is playing hard core no deal before referendum (which has been already threatened in its legality as the Greek Constitutions forbids referendum on fiscal matters).

– On the other side Europe decided not to cut the emergency assistance.

As a primary consequence it look like PM Tsiparas is in a corner and could lose government majority even if a NO wins, with more confusion ensuing.

On the stock market we are having a nice rally, but looks like more an oversold rally to me.

The key point is SP500 2,072/2,067. But the deteriorating pattern in DJ Transportation and DJ Utilities indicates that is more a matter of time before the breach occurs.

China – after the PBOC intervention we saw another wipeout caused by the shadow margin lending. In my view this is a basing pattern and it will be volatile for a while. But a crash is something that the Chinese Government does not want (also it did not want a mega rally as before as it is unsustainable)

So we can still expect a weak July and then a volatile recovery pattern in August.

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