Thursday, 18 September 2014

11am update - new historic highs

The third consecutive day of upside, with the Dow and sp'500 breaking new historic highs.. there is little reason not to expect most other indexes to follow. VIX is in melt mode -5% in the 11s. Metals have turned moderately higher, Gold +$4.


sp'60min


Summary

So... new highs..and zero sign of a turn.
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Meanwhile, there is absolute carnage in the coal miners.... which is quite an achievement considering the declines since 2011.

ACI -5.7%.
BTU -5.1%
WLT -8.4%

Truly horrific multi-year declines, with ACI, ANR, and WLT all looking vulnerable to ending up on the pink sheets.. if not disappear entirely.
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*As things are, this looks a lousy place to get involved on the long side - in terms of the main indexes, so I'll stay on the sidelines. At worse.. it just keeps climbing, but at least I'm not short.

10am update - opening gains

US equities open moderately higher, but so far.. no new historic highs. A minor down cycle into the typical morning floor/turn time of 11am looks... probable. Best case for the bears.. sp'2000/1998.. with VIX 13s.


sp'15min


Summary

So, opening gains, but I think there is a fair chance of most indexes actually turning fractionally negative by 11am.
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*seeking to go long-index... a trade from 2000 to 2015/20 - by the Friday close would make for a good way to end the week.
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Coal miners remain dire...

BTU...  headed for $12/10


Truly....dire... but then, the US Govt' has a 'war on coal'


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10.00am   Fractional new historic high on the Dow, 17223.

....BTU still falling -5.1%

*phil Fed 22... down from 28.... somewhat disappointing...   market doesn't care though...

Pre-Market Brief

Good morning. Futures are a little higher, sp +6pts, we're set to open at 2007.Metals remain weak, Gold -$3. Equities look set for another day of gains, with the bigger weekly cycle offering the 2030s next week.


sp'60min


Summary

*weekly jobless claims: 280k... much better than expected

August housing starts -14.4%... pretty ugly number 
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Hourly equity cycles are clearly over-stretched. It won't be easy for the bulls to keep pushing higher across all of today. I'd still not be surprised if we pull a touch negative later in the morning.

Notable early weakness, coal miners, BTU -2.7%

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*I would like to go long-index, but finding an acceptable entry is going to be difficult.


9.11am.. sp +7pts... 2008... a mere 3pts shy of the historic high.

According to clown finance TV, the Alibaba IPO will price tonight, and so I guess the actual first trades won't be until tomorrow.

One taper to go

The Fed didn't surprise or upset the market, with all indexes closing higher for the second consecutive day. There is now just one more QE taper to come (FOMC Oct'29)... the equity bears will soon be free of the QE fuel.


sp'monthly'8 - QE periods


sp'weekly8


Summary

*with further gains, the weekly candle has turned green, and we're back to an outright bullish market. Upper bollinger is offering the 2030s.. which seems viable as early as next week. By mid October, we could be looking at 2050 or so.
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So... QE will be a mere $15bn a month starting Oct'1st. It will be fascinating to see how the market reacts (psychologically) in the remainder of the year.

The sun is setting on QE3

Looking ahead

Many will be focused on the Alibaba IPO (ticker BABA). I'm unsure as to when it will be listed, but regardless, it'll be the worlds biggest single IPO. With investor demand and media attention at such high levels, I would not be surprised if it hit $100 on the opening day.

Weekly jobs, housing starts, and Phil' fed... will also be something to give prices a kick in early morning.

*there will be very minor QE-pomo of around $0.3bn.
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Goodnight from London