Thursday, 30 July 2015

Pre-Market Brief

Good morning. Futures are a touch lower (ahead of GDP data), sp -2pts, we're set to open at 2106. USD is building early gains, +0.4% in the DXY 97.30s. Metals are weak, Gold -$10, with Silver -1.0%. Oil continues to climb, +0.4% in the $49s.




With the FOMC out of the way until mid Sept', the way forward is a little simpler from here.

Now it is simply a case of whether we see new highs in 'some indexes'... before breaking lower... or see another failure in the near term.. and then take out the recent key low of sp'2044.

It remains notable that a number of indexes recently broke the equivalent level of sp'2044. Then there are the trend breaks on the bigger weekly/monthly cycles, but few seem to have noticed that rather important development.

*I remain long-VIX... and frankly, considering we're now already in the 12s.. how much lower could it go anyway?

Hourly equity/VIX cycles continue to threaten an equity down wave into the Friday/monthly close... the setup does NOT favour the equity bulls across the next two days.

Early movers...

FB -1.4% in the $95s.. post earnings depression

WFM -14%, after a marginal earnings miss, back to the low from last Oct',  $35s.

GDX, -2.4%, as the precious metals continue to weaken, Gold is headed for the giant $1000 threshold.

Update from Oscar

Overnight China action: The volatility continues. with the Shanghai comp' seeing a lot of chop.. but then a sharp sell down in the late afternoon, settling -2.2% @ 3705. The recent low of 3373 really isn't more than 1-2 trading days of declines away.

Have a good Thursday

*standing by for Q2 GDP data - due 8.30am EST.

8.31am GDP 2.3% , vs prev' +0.6% (revised from 0.2%)

Broadly.. a 'bearable' number for the market... not great... but not dire either. Further, the revision for Q1 negates the recessionary threat.

Equities weakening... .sp -6pts @ 2102

Metals under increasing pressure as USD claws upward, Gold -$14.

Equity bears should remain seeking a daily close back under sp'2100....  along with VIX 14s.. for the weekly/monthly close.

9.13am.. sp -8pts.. set to open at the 2100 threshold.... that will probably equate to VIX 13s.

A daily close <2090 would be useful... with VIX 14s.. but I realise most would argue that is out of range.

9.38am.. VIX making an initial break above hourly 10MA.... hmm    with sp'2101

9.44am.. Clear breaks all over the place.. VIX 13.18...   with sp'2097. 

Mining stocks imploding. GDX -3.7%.... 100% horror.