6-13-16 Before the open

Watchlists have been posted. In a model portfolio based on 100% above average volume breakouts, the longest held position is EBIX, up 23.7% over 16 weeks. ULTA is up 27.3% over 15 weeks and WB is up 41.8% over 11 weeks.

Friday was a significant down day with the NASDAQ gapping down and closing near the lows on higher volume. The number of distribution days since the last follow-through day is just one day. Until the distribution count climbs to five or so, I won't get worried. However, the NASDAQ may have put in a double top (4/20/16 and 6/6/16) inside of the third right shoulder of a large head and shoulders pattern. We could easily correct from here, at least until the Brexit situation concludes. If Britain exits the EU, we could have a Nexit, Frexit, Spexit and Grexit.

MSFT has gone sideways for decades, I wonder about the timing of the LNKD purchase; this is the type of move that can mark a market top.

Last week the ECB launched a new stimulus tactic: outright purchase of corporate bonds: free money for Eurozone companies. What will they do with the cash? I don't know; maybe they will repurchase their outstanding stock sending the market up. In the end, I believe that the central bank economic experiments will end in chaos, I just have no idea what the trigger will be. However, the dissolution of the EU would be a big deal. Until armageddon, I just follow the market pulse which is still long. Negative interest rates probably will destroy insurance companies and pension plans. I smell a big short coming some day.