Risky assets likely to stay on back foot, perhaps after bouncette. Quick Bund Update

Although risk seems to gaining some traction again, I can not help thinking that the upside is limited. THE SP500 followed through nicely on last weeks call, and whilst a bounce is possible, I can not help thinking that further downside is to come. I will hopefully elaborate on this further at some point this week, when I have time.

Echoing this theme, of risk-off has been a the Bunds (German Government 10 Year Future), which has seen a  decent bounce and rally of late, echoed by a large drop in German 10 year yield, all helped by the latest concerns on Greece and the PIGGS. This looks like it it a serious bounce, and I can not help thinking we have more upside to come over the coming weeks, though probably after some consolidation.

I have attached a Daily chart which shows the Bund future continuation. It looks as though we may have an irregular double bottom on this chart, also of interest is the daily pattern over recent days, the 3 up days ending yesterday have produced a bullish '3 White Soldiers' pattern, the antithesis of the bearish '3 Black Crows' pattern.

For longer-term players, there is a possibility of a move in coming weeks towards 127 area, with support first in the mid 123s, and more meaningful support in low to mid 122s, which will have to hold to keep rally on track. If this is correct, we may see some further flight from risky assets at the same time in coming weeks, after a small pause/correction.