Tuesday, 19 February 2013

Volatility melts lower

With the indexes still comfortably melting higher, the VIX in contrast is melting lower, closing -1.2% @ 12.31. VIX 11s, 10s..or even single digit VIX seems likely by the early summer. The only issue is whether the equity market gets stuck in the sp'1600s..or the 1700s.




Very little to note, other than the opening minor jump higher..failed entirely, and Mr Market is entirely fearless.

*there was a little spike lower in AH, hitting 12.08.

As things are, it looks like VIX will remain sub'20 until May.

Those seeking a VIX explosion - even a mini one, would probably be wise to sit back, and wait until late April to take any new VIX long positions - not least in those decaying horror stories..that are the TVIX, UVXY, and even the non-leveraged VXX.
more later....on the indexes.

Closing Brief

A shortened trading week begins as expected, with another slow motion melt higher, aided by HFT algo-bots, fuelled (partly) by POMO $, and cheer leaded by the deluded maniacs on clown finance TV. This nonsense is likely to continue for some weeks, if not at least 2 more months.





New historic highs for the Trans and R2K (not shown).

Looks like a baby bull flag on the Dow hourly chart, although lately, they've been somewhat unreliable.

New high for the sp' @ 1530, a mere 46pts away from Oct'2007 high.

Nothing bearish, is there?

Even if we break the lower channel of sp'1520 (at the Wednesday close), downside is now almost certainly no lower than 1490.

It remains a disturbing market of near complete bullishness, with total complacency about everything.

More later..on the VIX, Indexes, and the bigger picture into the late summer/autumn.

3pm update - tedium into the close

Another day...same as ever. Algo-bot slow motion melt higher. Its that simple, and will remain that simple until the Fed end QE..which seems about as likely as a 10km rock hitting London.



So..the sp'1530s. Upper bollinger on the monthly is 1545 or so, there is still another 1% room before we really do get on the edge..and when March 1'st comes, that'll jump to the 1565/70.

The sp'1600s do look VERY reasonable to expect by April.

As for the rock....check this video out. Its one that never did really get any mainstream coverage. Ohh how they run..as the world ends !

back after the close

12pm update - why would it stop?

The main indexes are comfortably holding onto moderate gains of 0.4% or so. Nothing dramatic, but then, that's the nature of the algo-bot melt. This is week'7...and there is no reason to expect it to end until the POMO program is terminated...which doesn't seem likely for at least another 4-6 months (if ever)



Its just another week higher in the US/world markets, everything is outright bullish, and a break into the sp'1600s looks very feasible by April.

The only issue seems to be, do we just ramp into the 1700/1800s by late summer - and then crash (briefly), or do we pull back from 1600 to 1500/1450...before a ramp to 1800s by year end?

Regardless of the near term trends..the long term one looks very clear.

Metals update..

Metals remain weak...getting kinda close to support on the daily/weekly charts, although the monthly charts offer major downside potential.

So long as the dollar turns back lower within a few weeks, metals should see some significant bounce.

SLV, daily

GLD, daily

Some good volume on the metals today, a lot of the weak bulls being washed out, along with the knife catches being stopped out with this mornings declines.

Clearly, its the 'cartel' right? lol. 

VIX update, from Mr T..

back at 3pm

10am update - morning melt

A short four day week, and Mr Market is already showing the same kind of action we've seen since the start of the year. The algo-bots remain in full control, and with the regular moderate daily dose of POMO money, we're set for higher levels.




Only the VIX is showing a little sign of bearishness, but its not even 2% higher...so..its arguably noise anyway.

Metals a touch higher, after last weeks sell off. The dead cat bounce?

With the weekly/monthly equity charts still battling upward..pressure remains to the upside.

Rising support

Just consider the daily sp' chart, key rising bollinger support is now 1488..and by end of this week will be 1500. So...how can anyone expect sub 1500s any time soon now?