US long term yields

Yesterday, the US 10 year bond yields broke the 4% and the declining 200 day MA.(green line)
The mid-term technical target of the bullish ascending triangle is around 4.7% for the coming weeks/months.

Brent

Le Brent arrive désormais à la hauteur d'une zone de résistance majeure vers les 130-135$, ce qui correspond à la borne haute du canal haussier sur le graphique long terme.
Actuellement, cette plage de cours a de très faibles chances d'être dépassées sans la réalisation préalable d'une correction.
Le marché est clairement en état d’exagération et les indicateurs techniques déjà fortement surachetés perdent en puissance.
De plus le volume récemment constaté est très important (configuration de blow-off) ce qui est souvent une indication de fin de cycle à court terme.
A plus long terme l’objectif reste 150$ mais avant le prix du baril devra faire une pause, ce qui implique une correction.
Le premier support à surveiller se situe vers les 120$ mais une correction plus importante comparable à celle récemment observée sur l'once d'or (15%) est tout à fait possible.

Short term decline or new bearish leg?

After failing to break above the 3900 resistance level the DJ Euro Stoxx 50 may start a correction.On this hourly chart, you can clearly see a break of a bullish ascending trendline.The first support zone is 3700.

If the index failed to rebound in the coming days, there is a high probability of extending the slide towards the lower part of the rectangle. (daily chart-support around 3500)

New all time high for the Baltic Dry Index

This index is a measure of shipping costs for commodities and reflects strength in the global economy as well as strong demand for raw materials.

This is good news for energy and materials stocks.

Still bullish

In the US, the SP500 was able to remain above the important level of 1400 and is now testing the falling 200 day moving average.(green line)

The index now faces short-term overbought pressures and it may have some difficulty climbing above it.

The good news is that price momentum, patterns and investor sentiment suggest conditions are still supportive of further upside gains.(mid-term target is 1540)
The bad news is that the rally continues to be very selective, driven primarily by basic resources and energy stocks.
This rally needs to broaden or it may fail in the coming weeks.

In Europe, the DJ Euro Stoxx 50 and the Stoxx 600 were not able to break above resistances (respectively 3900 and 330).
This is an indication that bearish traders are more active near resistance zones.
Nevertheless, I still think new breakout attempts are likely in the coming days.

Short term pull-back?

Last week, the SP500 rose above the important level of 1400, which open the door to the 1540 level for the coming weeks.
In Europe the DJ Euro Stoxx 50 failed to break above 3900.
So far, I estimate that a break through 3,900 is still likely but a failure to confirm such a breakout by the end of next week would force me to reassess this scenario.
On a long term basis, I still believe that the current move is only a bear market rally and is probably not the start of a new secular bull trend.
On a short term basis the market is moving into an increasingly overbought position. (see chart below)
That could suggest that a short-term pullback may occur over the next one or two weeks but as long as we have the SP 500 above 1390 I don’t expect any major negative surprises.