UBS Sales Desk: Technical Rally To End Shortly, Lows Could Be Retested Late July

The stock market Brexit bounce is likely to be short-lived, says a report from UBS sales trading desk. On a technical basis, wave patterns could take stocks higher in the short term, but a gravitational pull might take place near the major political conventions in July.

Brexit sell-off generated fear, but not panic

The Brexit sell-off that occurred mostly on Friday and Monday did technical damage, according to the independent views of Michael Riesner and Marc Muller on the UBS sales trading desk. Not only was the upper end of the 2120 / 2025 near term trading range broken, but the 200-day moving average was violated.

In the aftermath...