Greece is now facing its debt problems again, with raising fears of extending the deadlines could mean default on its Greece Bonds.
This Global Bull market is still intact, but European Debts really pose a very very high risk threat of ending this bull market rally, US equity rising due to good earnings, but European Equities follow the U.S.? with month on month jobless rate increase, debt problems, and Default risks? This really injects to my mind that 90% reason of the next recession, are due to European problems, one possible scenario is a default of one of the biggest state/country in Europe.
DOW JONES daily charts shows a stay at the 12,500 critical support. A break below means negative effect to the bull market, with long weeks of sidelines and downtrend pressure. And a support at 12,500 with a good rally upward means Equities for the U.S. is really at a fair value and about to go up. Target price is 13,000-13,200. BUY near 12,500 Level, cut loss if it falls below 12,500 with the next support of 12,000.
The only risk having in the U.S. equities is the Negative Divergence formed on the Weekly Charts of S&P, DOW and Nasdaq, I still believe it posts a 30% chance of forming into a sell-off, but I still believe, a good and strong rally could negate this Negative Divergence.
For our Philippine market, PSE is still choppy, with no signs of movement. I expect our market to be choppy until the movement trend of U.S. Still, the negative divergence is posing a threat and shouting "correction". For the PSE market, I am 80% confident, that a good correction to 4000-4100 level is mandatory, to make a good support and form a bottom, eventually make new high and attempt the 4400 resistance level. HOLD and wait for correction.
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