The board has been mildly Risk on since the Asian opening last night. Europe didn’t disintegrate over the weekend.

The world seems to be in wait and see mode, waiting for a clear signal that we can get through the 200 day in the SPU’s and make another assault on the 1300 level.

Oil…the point & Figure charts show new action above 102 is needed for more upside. Oil inventories come out Wednesday A.M.

Euro is keeping to it’s recent range, while the Aussie needs all new action over 103.30 for a clear signal.

RBA meets on rates tonight coupled with political jockeying all week in Europe will make for more day trading.

While most pundits seem to think we will get a bullish outcome for the equities based on a European accommodation, I see little reason to take that bet. As of this writing, I just do not see the risk reward in committing new capital on a bunch of politicians.

That could change with further price action, but for now the best strategy seems to be short term trading.

Model Trading Portfolio…Current Holdings

No positions

Our view is that the rest of the year will be a High Volatility, Highly Technical, Rumor Driven, Time Frame, Lemming Effect Day Trade.
The question is who’s day? Right now it’s Europe’s.

Medium Term View…

We believe the political and economic risks are now heavily skewed to an all cash portfolio. The markets will become a big day trade.

30 Yr. Bonds …I’m treating 147 as the high for a long time. 143.10 now becomes our upside pivot. Closing above this level
will be short term positive the Bonds and negative the equities.