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FKLI:-  Don't Be Fooled By Greece's "Solution" -7/25/2011

The market continued its fall last week but it may has reached a temporary bottom again. Price manged to closed above the lower Bllinger Band on last Friday. So I closed off my prior shorts trade. But I did not engage any new long since I did not get a confirmation from the indicators yet. The first confirmation would be the a positive Stochastic crossover.

The ADX has stayed flat for the past few days, indicating a sideway market again. Overall  the MACD, Stochastic and DMI are still negative. So I would stay more bearish biased for the time being and I will re-engage new shorts if prices go below the bottom Bollinger Band again.

The weekly chart's  has increasingly losing the script as the Stochastic has turned negative. When if it goes below the 80's will confirm a more bearish approach. The DMI has also turned negative. The MACD though remains positive but it  has  begun to turn around.  Meanwhile the ADX has once again begun to fall. It is now at 10's , so expect the market to be listless again.

Please take note the ADX has gone below 20's since March this year and has stayed there ever since. And with the presence of a bearish divergence, I think the next bear cycle would be an extremely explosive , nasty and a messy one. You should keep this picture in the back of your mind when you re-assess and organize your investment portfolio.

I think not many thinking people would really believe the PIIGs crisis was resolved last week. And with China's picture continues to deteriorate, I think the current global market is just like waiting for someone to scream "fire" inside a packed cinema before hell breaks loose.