The SPYs dropped sharply, gapping lower, moving through the 10, 20 and 200 day EMA. Prices rallied to the 200 day EMA, but fell back. Also note the increased volume spike.
In contrast, we saw the Treasury market gap higher on strong volume. About the only good thing on this chart from a "risk on" perspective is that prices printed a very narrow candle which many traders consider a reversal pattern.
Finally, we see the dollar has rallied from the 21.20 are to the 200 day EMA, moving through all the shorter EMAs (10, 20 and 50 day) to settle right around the 200 day EMA.
So -- what does all this mean, really? First, two days of technical action is really pretty meaningless in the bigger, longer run picture. However, the Greek announcement is a huge game changer, which I'll explain in the next post. The bottom line is the fundamental backdrop against which we look at the technical market indicators (or through it), has changed in a significant way -- and not in a good way.
