January 5, 2011 07:29 ET: MANY HAVE THEIR OWN REASONS forwhy stocks may be facing a pullback soon. Readers of my website and mybook Currency Trading & Intermarket Analysis are familiar with theuse of the Gold/Oil Ratio and its inverse relationship with globalequity indices. Weekly and daily technicals in the Gold/Oil ratio areindicate a bottoming process, a pattern of which has triggered broadselloff in equities. I am expecting a pullback of 3-5% in theS&P500, revisiting the previous top at 1,230. This is likely totranslate into an extended decline in EURUSD towards $1.3050 and aretreat in AUDUSD towards 0.9770. Tehnically speaking, none of themajor equity indices are show any notable arguments for a pullback. Butthe intermarket argument from the 2 major commodities suggest a selloffof at least 3-5% is overdue.
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