Tuesday, 3 December 2013

Volatility breaks into the 15s

Whilst the main indexes saw some moderate declines, perhaps the most notable aspect of today was the VIX, which broke into the 15s for the first time since mid October. With the indexes clawing back upward into the close, the VIX slipped back, settling +2.25% @ 14.55.




So..the VIX broke into the 15s, which is kinda impressive, with the sp' still in the 1790s.

The daily closing candle should really concern the equity bears. We have a black-fail candle, and that is certainly suggestive of equity upside tomorrow.

As a fair few out there are looking for, a move back into the sp'1805/10 range..before another wave lower..later on Thur/early Friday.

On no basis though, do I see the VIX managing to claw into the 20s before year end. That would be a real surprise to me.
more later...on the indexes

Closing Brief

The main indexes saw a latter day recovery, with the sp -5pts @ 1795. The two leaders - Trans/R2K, closed -1.0% and -0.5% respectively. The near term could easily see further price chop in the 1810-1780s, before another push to new highs in the latter half of the month.



Certainly.. an interesting day to watch..and be part of.

The morning had an initial fake low of 1794..and with the break to 1787.. no doubt..many were getting overly lost in bearish hysteria.

Bigger trend remains to the upside..and with continued QE...bears face the same old problem.

We'll more than likely see further upside across at least the first half of tomorrow.

more later..on the VIX

3pm update - closing hour recovery

The bears have controlled much of today, but with some QE money sloshing around out there this afternoon, we're seeing what is probably a spike-floor at 1787. A daily close in the low 1800s is very viable. Metals look set to bounce into early tomorrow.



For the bears..could be a really annoying and frustrating closing hour. A daily close in the 1800s would really help to re-inspire some of the more weak minded bull maniacs..that the broader picture remains...bullish!

Fed beige book tomorrow, ..and wouldn't surprise me to see Gold/Silver higher by 1-2%.

Notable strength in AAPL, now +$11 @ 562.

End year target remains 580/600

3.18pm.. AAPL and TSLA building on gains...very impressive power in both stocks.

The broader market remains weak...and so far..bulls just aren't showing up. Hmm.  Regardless, the hourly cycle is primed to snap higher in the very near term. Certainly, it is not a good situation to be holding short overnight.

3.29pm.. very marginal situation, bulls need to hold 1790 !

The smaller cycles still suggestive of upside...into the close.

3.33pm.. 1790 holds..and we're moving up !

3.41pm.. equity bulls should seek a close above the hourly 10MA... 1797.

AAPL..and TSLA holding their powerful gains...so impressive.

UAL -3.5%...and I've no idea why. Anyone know?

3.51pm..bears getting the hammer into the close...although I realise.. a fair of you short this morning..already bailed.. well done people!

back at the close.

2pm update - VIX breaks into the 15s

Perhaps most notable today..despite being a small % move, is the VIX, which has broken back into the 15s, for the first time since mid October. Meanwhile...sp' has lost the 1790s....equity bulls have downside buffer of 70/80pts on the Dow, and the metals are trying to bounce.




Well, just two hours left of the day, and so far..bulls are failing to show any power..yet we've seen time and again, a closing hour ramp.

Of course, the last few days have seen closing hour weakness.

Rest of the day...could get pretty interesting.

*more QE tomorrow, and lots of data/reports, so..should at least not be dull!

2.38pm.. market trying to punch in a spike-floor.


1pm update - bull maniacs need to hold Dow 15800s

The smaller 15/60min index cycles continue to offer a latter day recovery, and with sig' QE, the bears face problems this afternoon. More importantly, the bulls need to hold the Dow 15800s, otherwise the original breakout is in jeopardy.

Dow, daily


The bigger weekly/monthly charts would most definitely argue against a failure.

So..for the big money right now...stop levels would be somewhere in the 15700/600s.

Notable strength remains in AAPL and TSLA, with the latter +14%.

TSLA, daily

No doubt, a lot of shorts are bailing..and chasers are coming in ! Even so..it doesn't change the mid-term weakness since the original break lower.

1.45pm.. and there goes 1790.  Regardless.. indexes are still only -0.6%.

VIX trying to break into the 15s....been a long while since we saw mid teens!

12pm update - late morning bear tease?

Equities see renewed weakness in late morning (for whatever reason/excuse), and we're on the border of losing the 1790s. Despite the declines, equity bears face the relentless QE..and it will be fascinating to see how the market proceeds across the rest of today.




VIX might be maxed out..its on what is soft trend-resistance. Certainly, the opening black-fail candle..was itself..a fail.

Frankly, with heavy QE, I'd still be looking for a latter day recovery. 

I see others with downside targets of 1760s..even the 1600s..the latter of which just look stupid right now.

Lets be clear, we're -0.5% right now....barely rates as 'moderate', and that is probably the best the bears can manage today.

VIX update from Mr T

*again, we are indeed seeing traders picking up Feb, March, and April VIX calls. Certainly..NOT near term..no point.

time to cook !

11am update - morning floor

The market appears to have formed a reasonably secure morning floor at sp'1794. With heavy QE today - and the smaller 15/60min cycles offering upside, the equity bears face real problems for the rest of today. Notable strength in AAPL and TSLA.


RIG, daily


Bears face major problems as we move into the afternoon. Anyone short the indexes should be very concerned about the spike-floor candle on the hourly charts.

*I am long RIG from a little earlier..seeking an initial exit in the 52/53s..perhaps late this week.

11.29am..well, so much for the morning floor...marginally taken out..and 1790 now back on the table before the bigger QE kicks in this afternoon.

Regardless, the bears still lack any real downside power, but hey, that has generally been the case for over two years.

10am update - opening weakness

Equities open moderately lower, but certainly, this is nothing for the bears to get excited about. Market is holding comfortably together, and with very heavy QE in the rest of this week, there will be very significant underlying upside pressure. Metals are failing to bounce..so far.


RIG, daily


You can probably feel the year starting to wind down now. That end of year feeling...is most definately out there.

*I'm considering a RIG -long, trade. There is near term downside to the 48s, but upside is the 60s in early 2014.

update.. LONG RIG, from $50.  Seeking 52/53..near term..might bail there, but seeking 60s as a bigger target.

10.24am.. bears struggling..and with heavy QE later today..who would bet against a close in the sp'1800s?

The maniacs on clown finance TV remain bizarrely lacking any arrogance when it comes to the market. They sure won't be getting hyper until the next top...ironically.

10.27am... TSLA ramping...upside...160..where there is also an obvious downside gap.

Regardless, I'd see the 50 day MA at 160 as a re-short zone.

Pre-Market Brief

Good morning. Futures are moderately lower, sp -5pts, we're set to open around 1795. Precious metals are seeing a minor bounce. Gold +$3. Equity bears have small opportunity this morning to push the market down to the low 1790s.



Today is going to be a pretty tough battle for the bears. Yes, we're set to open a little lower, but there are two QE-pomo today - the bigger one is in early afternoon.

Even if we hit 1790 this morning, do not be surprised if we're in the low 1800s by late afternoon.

Video update from Oscar...

Notable early mover: TSLA, +5.6% @ 131.

It remains a little odd how $110/100 has not been hit yet. Yet, Oscar is probably right though, and the secondary target in the 70/60s will be viable early in 2014.

9.38am.. equity bears  having problems already...

momo stocks catching a bid.. TSLA +$10... AAPL +$12...

black-fail candle on the hourly/daily VIX charts...!

Heavy QE will surely get the market back into the 1800s today.

Viable upside for December

A new month, and the upper bollinger bands have jumped another 2-3% higher. This month, Dow 16500 is viable, along with sp'1840s. Despite any near term weakness, the broader trend into year end and early Jan'2014 remains unquestionably to the upside.

Dow'monthly2, rainbow

sp'monthly'2, Bol'/Keltner bands


Now, of course, just because the upper bollinger/keltner bands have jumped higher, it does not mean we're going to hit those levels..but considering the past two years...you'd have to bet on the side of the bull maniacs.

Certainly, with continuing QE, the equity bears face a very tough task just to knock the market 1-2% lower. There remains huge upside pressure in this market, and despite some end year selling issues (whether for tax purposes..or whatever reason), the market is more likely to continue broadly higher..than be in the process of forming a multi-month top.

Indeed, equity bears should go stare at the following for a good hour...

sp'weekly'8 - mid-term bullish outlook

I'm holding to the original outlook from early summer. General upside into late spring 2014, with a key multi-month intermediate top...and a down wave concluding in the Aug/October time frame.

Looking ahead

There really isn't anything of significance due tomorrow.

*there are TWO QE-pomo tomorrow, the bigger one is due in early afternoon, so...bears beware of a latter day ramp!

I remain largely on the sidelines, having bailed on an SLV-short, early this morning. I was looking for a bounce..but metals seem super weak. If the declines in the precious metals continue across Tuesday, I won't chase them lower, and will look to other things.

Goodnight from London

Daily Index Cycle update

The main indexes were weak in the closing hour, with the sp -5pts @ 1800. The two leaders - Trans/R2K, closed +0.3% and -1.2% respectively. The broader market trend remains to the upside, with Dow 16500 and sp'1840s viable by end year.





So..another weak closing hour, and no doubt some of the remaining equity bears will be getting somewhat excited about a near term decline.

Just how is that viable? We have VERY heavy QE on three of the next four days. A move even to the sp'1770s looks..difficult.

Certainly, we have a break of trend on the hourly/daily charts, but more than likely, we'll just see price chop, rather than 3-5 days of downside.

The notion of a 'significant' drop before year end is arguably utter nonsense.
a little more later...