Complacency .... Complacency ... Complacency

Not sure what the fuss is about .... Back to where we were last Thursday .... Still up on the year ....  The same sentiment echoed across dealing rooms and social media around the world on Friday in response to the Historic Brexit decision from the UK.  After the dust had settled we'd had a pretty decent sell off in risk assets and of course the pound but its the complacency that worries me , a lot!

The whole bull run in stocks back up from 2008 lows has been maligned. We have rallied pretty much in a straight line for most of that time pausing for breath along the way but most people seemed to deem it a house of cards and have been keen to declare its vulnerability jumping on every selloff as a new crash and calling the end of the world ... until that is .. now !!

Sentiment has changed and its changed quickly ... now my social media timeline is full of dip buying recommendations , the news isn't that bad  .. it always bounces right ??

Barrons 28th May cover was a major warning signal .... A huge red rag to a Bear if you pardon the pun !! 

Friday was a horrible day across the board pretty much but the standout was the Nasdaq 100. Rammed with spec long money its the index where the major bio tech and real tech darlings live ... its jammed with late to the party hot money longs.

I think the real clue about Friday was the close .. it closed nicely below the 2 previous lows .. as you can see from the chart we have an initial target in the low 3800's but i fear that maybe just the beginning ...this noticeable sentiment shift takes out the short covering that used to accompany major sell offs .. instead we ll have vacuum gaps lower and we could easily see 3400 in this index. 

World stocks are in serious trouble over the next few months and maybe a much longer time frame we will have to see if sentiment changes but in my experience this is only the beginning !   GAN.