Solar Energy looks more attractive than Fossil Fuel Energy near-term

Short-term trends in US Equities remain bullish, and following this week’s breakout now lie within striking distance of all-time highs. While a rally over February peaks should happen this Summer, it’s hard to make a technical call for an immediate breakout given the minor slowing in momentum coupled with weak seasonality trends for June. Meanwhile, the US Dollar has begun to move sharply lower, and Treasury yields look to be joining DXY following this week’s breakdown in yields across the curve. Additionally, precious metals, Emerging markets and commodities are all an area of near-term focus and can likely work well in the weeks/months ahead given a falling US Dollar.  Overall, a push up to between 6000-6150 is likely for SPX, while QQQ should rally to 540 before some minor stalling out.

My short-term thesis still calls for a push up above SPX-6000 which can get close to, but not eclipse February peaks.  Treasury yields and US Dollar weakness today seems to be ongoing and should serve as a positive for US risk assets.

While all-time highs eventually should be surpassed, my feeling is that the combination of DeMark indicators, poor June seasonality, and some minor negative breadth and momentum divergence likely result in a slowing of this rally within a week.

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