Almost EOFY folks, let's have a look at the below monthly XJO...

Almost EOFY folks, let's have a look at the below monthly XJO chart since 2004.

I have marked every June bar with a vertical blue line so we can compare how XJO performed in the past around this time of the year.

Prior to the 08 financial crisis, June was either up or flat. After that, June was either flat or down except for 09 when market was correcting itself and THIS YEAR !!!!!.

There is a similar pattern from 2010 till last year that May and June sell down happened after some decent gains in previous quarters. Or we can firmly say that was due to profit taking before the EOFY. However this year April / May / June are exceptionally strong as if profit taking already happened in Q3 which almost took it back to the low of Q2.

XJO has been trading in an upward range since 08 and one would think the next target will be the upper trend line near the all time high. Let's pause and look back again. From June 12 low to Feb 15 high, market went from approx 4000 to 6000 mark in 2.5 years then it pulled back to roughly 4800 in Feb 2016. Since then it is almost 2.5 years and we should be close to 6800 (if it wasn't because of the Feb bond sell off).  It almost seems like the Q2 2014 high has come early to this quarter.

I wouldn't want to bet against the uptrend but 2018 has been a special year which marks the end of a decade long of Quantitative Easing. FED is now on autopilot rate hikes. Early signs of credit crunch have appeared in emerging markets. What will the next FED hike in September do to the world financial market ? US has the habit of f*cking up the world financial market since 1930. Bring on the next financial year !!!!