Friday, 7 August 2015

Pre-Market Brief

Good morning. Futures are broadly flat ahead of the jobs data, we're set to open around 2083. Equity bears just need an intraday move of sp -12pts to 2071 to break the 200dma.. which will open the door to a weekly close in the 2060s.. or even 50s. That should equate to VIX 15/16s.




 *it would be really useful for the equity bears to break below last weeks low of sp'2063.

A big day is ahead. We're currently net lower on the week by around 1% for the sp'500. A weekly close <2070 would make for a very bearish close, and offer further clarity that the market has maxed out for the summer, if not the year.

Overnight China action:  Broad upside across the day, settling +2.3% @ 3744. There remains a high risk the PBOC will cut rates this Sunday.

standing by for the jobs data (due 8.30am EST)................

8.31am net gains: 215k, headline jobless rate: 5.3%. . inline.

Indexes:  moderate weakness, sp -3pts... 2080.

Eyes to the USD and bonds....

USD +0.3% DXY 98.10s....

Now.. its merely a case of whether we can break <sp'2072 today....

8.34am.. with stronger USD.. commodities under pressure,  Gold -$4... with Oil -0.7%

8.40am.. sp -5pts.. 2078... just 6pts away from a clear break..  Of course.... the Dow/Trans... well below such equivalent levels.

KEY signal...  bonds just jumped... TLT +0.3% in the $123s... a break into the 124s today would likely equate to sp'2060s.

Bonds look set for broad upside into early Oct'... and that sure isn't going to help equities.

8.56am... micro jump... sp +2pts... 2085.  Hmmm

USD remains +0.4%  98.20s.... underlying downward pressure on commodities....increases.

9.00am.. sp +5pts... 2088...

Arguably... another opening minor gain... set to fail....

For those not already long VIX... its a viable entry this morning....  unless of course you think we're headed to new highs into Sept/Oct.

.. but then... what about the technical breaks in AAPL... DIS, INTC.... etc ?

9.05am.. So... mixed chop in pre-market.... but we have some underlying key moves in the USD.. and bonds. Both are supportive of the bearish equity/commodity case.

USD in the 98s... it does bode for a key break above the giant DXY 100 threshold... and onward to the 120s.

I myself am still churning on 'how the hell can equities rebound after October.. if USD is broadly climbing across 2016'.

9.17am. Not surprisingly, the cheerleaders on clown finance TV are getting twitchy a viable seventh consecutive net daily decline for the Dow.. not seen since the mini crash wave of July/Aug 2011.

.. sp +1pt... set to open 2084.

Eyes on TLT +0.5% in the $123.40s... set to break new cycle highs.

9.38am.. battling it out... a few are clearly buying on support.. now at 2075.

Broadly..  the weekly/monthly cycles are clear...

*opening VIX reversal candle.