a rest period unless...

Biggest takeaway today is in what we’ll have to monitor this week and probably beyond for the short term.   Most recently, we’ve concentrated on the 10yr TSY/$TNX for market direction, now the focus turns to the Euro.   The Euro plunged through 1.28 signalling Euro-land worries ahead, next and possibly only short term key support 1.268-1.27 before the levy may break.   Sovereign debt issues and Euro banks are back into the picture due to a few major newspapers articles doubting the stress tests credibility.  "DUH!"   There was actually a similar piece in FT (Friday) and you know what took precedent that day.   As before, these peripheral Euro issues may disappear again, but , in the meantime damage still can be done if Euro keeps dropping and spreads widen, which will push risk markets down further.   The problem today is not only,  if the Irish can make it home safely from the pub, it’s the amount of capital raises by banks/countries coming, management chances at key banks and a profit warning from one financial name today that is causing the market hangover.

The market has no catalysts ahead as discussed this weekend after the ‘Bernanke/ Macro’ rally other than a longshot chance, Obama’s posturing promises for the mid terms helps a few mkt participants/sectors.   The markets eyes are focused today on Europe because there is nothing else on horizon.   The premise Friday morning here of taking a rest = taking some profits, as the market hit 1105 is unfolding today with a (1.2% SPX decline/ 15pts from Fri. high) market dip.    Unfortunately, even a 1% loss in the broader markets gave little chance to pick up back some of the favorites here lately as they hardly pull backed, even some like NZ  NFLX  were outperforming and making new highs.   (note: FTNT kissed 9ema)

See last week’s Journals for dip buying levels that may come into play “if” Euro doesn’t find support here.   Considering the 'slew' of negative headlines today didn't come with any panic (just a lack of buyers),and if Euro holds,  today will be looked as nothing more than just the profit taking/ rest period we were discussing coming into the trading week.