Gold, Silver, Pound Signal Danger
06/22/16 Weekly Re-Lay Alert: Brexit Brouhaha II
“As we enter the long-anticipated date of the UK’s vote on Brexit, the markets are increasing in volatility (particularly those that would be directly impacted) – further reinforcing the uncertainty being felt in Britain, the EU, and around the globe.
With recent polls showing a dead heat, there is likely to be no convincing consensus until Friday AM (overnight Thursday in the U.S.) – at which point the markets could see some abrupt moves. However, as is often the case, the initial moves could ultimately turn out to be misguided… or at least premature.
Regardless of the Brexit vote outcome, cycles continue to project yet another crisis for the British Pound – following the 8-Year Cycle that pinpointed UK currency debacles in 1968, 1976, 1984, 1992, 2000 & 2008.
In each case, the final low was in the ensuing year (1985, 1993, 2001 & 2009) – following dramatic declines – creating a delayed 8-Year Cycle that projects a final British Pound low in 2017. The Pound has rebounded since February but has failed (thus far) to turn its intra-year trend up.
The recent surge has also failed (through today’s close) to turn the daily trend back up…
Meanwhile, Gold & Silver have pulled back… but have NOT yet turned their daily trends down. . [See related Gold analysis on why another surge is still likely by/on June 24th]…
All of that technical action just reinforces the obvious – that tomorrow is the key…
And there are also the unintended consequences that have not – and cannot yet – factored in. Even if the ‘Remain’ camp is victorious, the entire campaign has
managed to raise more doubts & questions about the viability of a Brussels-led, often unaccountable & bloated bureaucracy that is the EU.
And that could lead to future referendums in other European nations – as divisiveness continues to mount throughout the EU.
This is already the ‘third strike’ in the past 2 years, beginning with Greek insolvency followed by mass immigration (that will burden many nations for years to come) and now the vote on Brexit… as well as accompanying demands made by the UK in early-2016.
In other words, there is one thing that is certain about the end of this EU referendum… It is NOT the end of the larger EU referendum. Meanwhile…
Stock Indices initially validated the potential for an intermediate peak in the first half of June… and remain vulnerable to a sharp drop into late-June–early-July (~5 months from the late-Jan./early-Feb. lows – that were ~5 months from the preceding late-Aug./early-Sept. ’15 lows)…
They are entering the most vulnerable period but have been slower (than last two instances) to build & maintain any downward momentum… The DJ Transports are again leading the way and could enter an accelerated decline in the coming week(s) . [See related analysis on why late-June/early-July is such a vulnerable period & why another sell-off could soon take hold. Tomorrow’s Brexit vote is poised to trigger market panic, regardless of the outcome. See June ’16 INSIIDE Track for 8-Year Cycle analysis]…
The Nasdaq 100 is also on the brink of a breakdown signal, needing a daily close below xxxx/NQU [reserved for subscribers]… to confirm a ‘3’ (or ‘c’) wave decline. On a short-term basis, that is the Index in the most vulnerable position for some follow-through selling.
Today’s reversals lower (many of them being outside-day/2 Close Reversals lower) are combining with the daily 21 MARCs (that move sharply higher in the coming days) to pinpoint the next 2 days as the most decisive with the greatest chance for some follow-through selling.
With so many Indices at make-or-break points, they need to signal further weakness to confirm the potential for add’l downside. At the very least, they need daily closes below 17,471/DJIA & 2039.5/ESU & 4265/NQU to accomplish that.
1–3 & 3–6 month traders & investors could have re-entered the short side of Stock Indices at 17,912–18,016/DJIA, 2077.5–2105.25/ES & 4378–4545/NQ and should [reserved for subscribers only; watch events of June 23/24th for critical confirmation]…”
[See June 22, 2016 Weekly Re-Lay Alert for additional analysis on other markets projecting a Brexit vote and a corresponding British Pound Crisis in 2016/2017. Stock Indices reinforcing expectations for a sharp sell-off in late-June/early-July – a precursor to what is expected later in 2016. See Stock-flation (and related) Reports for additional details.]