Today is a very significant day in the markets…
Each year a snapshot of the market is taken on the last day of May to be used to reconstitute the Russell Indexes:
Russell Global Indexes
Russell U.S. Indexes
Russell Stability Indexes™
BATS Chi-X Europe Russell Indexes
Russell-Axioma Factor Indexes
Russell Equal Weight Indexes
Russell Europe SMID 300 Indexes
Russell Eurozone SMID 150 Indexes
Russell Fundamental Indexes
Russell Geographic Exposure Indexes
Russell High Dividend Yield Indexes
Russell High Efficiency Defensive Indexes
Russell-IdealRatings Islamic Indexes
Russell UK Mid 150 Indexes
More than four trillion dollars in equities worldwide are benchmarked against those indexes–so today’s close is a very big deal. The following link gives a very good topical overview of what is happening…
May is the ‘ranking month’ and June is the ‘transition month’.
.Today is day 2 of the annual Bilderberg Summit, which for 60 years has been the meeting point for the global elite and particularly the hand-selected minions who do their bidding.
MP Michael Meacher describes Bilderberg as “the cabal of the rich and powerful who are working to consolidate and extend the grip of the markets”.
They now rule with such impunity that the once secret meetings are openly flaunted. At the conclusion of this meeting, new edicts will undoubtedly be enacted–so beware in the coming months.
The markets have been locked in a tractor beam of unnatural vertical ascent since 2009 and as I have pointed out several times in the past–we will know when the paradigm has changed when the weekly chart shown above suffers a break of the higher low progression (highlighted with green dots) that does not recover. We have had exactly one occurrence of that phenomenon in the past five years (highlighted in yellow on the chart above).
The last higher low was at 1803.25 and that is where all the big boy trend following stops are currently congregated.
Zooming in to the daily bar range chart, we can see that the ST and VST range breakout at 1898.50 marks first support and would be the initial counter-trend sell signal from Stops and Targets on a pullback.
It’s been boringly predictable lately–and the New York guys are starting to whine a bit that the lack of volatility is hurting business and their firm’s bottom line revenue. That volatility has been arrested by the Chicago futures guys and Chicago > New York since 2009. But in order to attract the revenue that comes from speculative trading…eventually, the pros are going to need to take the foot off the gas pedal–lest all the commission paying customers go away. First sign of a potentially tradable pullback is usually a series on unanimous confirmed top spotters across the indexes with massive internal confirmations in the Russell 3000, and so until we get that–or unless we start to break some sort of support–the game continues to be pushing the trailing stops up under the trending investments, as is shown by the massive net gains in Stops and Targets for the ES since the last trend start signals:
Long-term: +791.50 (+70.37 %) (last signal November 28, 2011)
Intermediate: +169.25 (+9.69 %) (last signal February 6, 2014)
Short-term: +82.25 (+4.48 %) (last signal April 15, 2014)
Be sure to keep the big picture in mind as coming staged events unfold. Remember that the weekly chart is the roadmap and preferred trading timeframe of the folks currently meeting in Copenhagen to decide your fate.