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Swiss top extension, Spain rallies into resistance

There have been a couple of top extensions in a Swiss equity index:

This is the latest in a series of top extensions that we have been reporting to you and it means that we can now add Switzerland to our list of 'short sale' candidates.

As we wrote before the New Year, we had expected to issue 'sell short' recommendations in the Southern European equity markets again, but there has not yet been a signal. Today's rally in Spain takes prices up to the old monthly-scale compression that provided resistance enough to stall the last rally and it may do so again:

This is not enough evidence to warrant a new 'sell' recommendation yet, but we are close to it... A new top extension here at a daily or weekly scale would provide the missing ingredient, so we watch and wait.

Happy New Year,