SPX behaved as expected today, stopping at mid-Cycle resistance and the Lip of its Cup with Handle. The sell-off may now begin. The institutional traders will be coming into play this hour, so be alert to what is going on.

TLT continues its decline. I suspect that we had a Master Cycle low on May 31 in TLT and June 4 in USB. If so, that was a very quick and bearish bounce, lasting a little over 3 days (26 hours) in TLT and two days (13 hours) in USB. I have market June 4 as the Master Cycle low in USB (which I follow in the cycles) and will remain alert for any unforeseen changes. However, the June 6 high was a retest of the Cup with Handle formation and agrees with deeper lows to come in the Long Bond. This may be the undoing of the Fed.

GLD may have put in its final high for the summer on June 6, leaving the door open for a probable two-month decline into its Master Cycle bottom in late July or early August. If you think the decline from April 4 to April 16 was bad, then I have news for you! The next two weeks may be as bad or worse.

Regards,

Tony

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