Wednesday, 28 October 2015

3pm update - spooked on threats of higher rates

US equities have seen a very clear reversal, from a cycle high of sp'2084 (with VIX 12.80), after the fed press release contains a threat that rates may be raised at the Dec' FOMC. First downside target is around the sp'2000 threshold.. which would be very natural to hit.




*a VERY clear spike floor in the VIX of 12.80. It doesn't get much more definitive.

So... we have a cycle high of 2084.

I've added a fib' retrace, and that is itself suggestive that a retrace would at least around sp'2000.

Ultimate 'best case' for the equity bears would be the price gap zone around 1950.. but really.. that looks out of range... and is not supported by recent price action.


Gold, daily

A hyper-reversal candle in Gold (and silver).. as higher rates are BEARISH metals. The fact it has lost the 200dma only adds to the bearishness in that one.

The bigger weekly cycle is offering a giant bear flag.

The $1000 threshold remains due.. and that ain't going to help the related mining stocks.

.. no doubt.. the 'gold bugs' out there will disagree with that outlook.

3.07pm... a micro ramp.. back to sp'2077.. but really... new highs look difficult now.

notable strength: AAPL +3.3% in the $118s.

TWTR.. a bizarrely strong reversal... from -11% to -1%... who is buying that nonsense today?

3.30pm.. sp' 2082...   testing the earlier high.   VIX 14.40s.

Oil set for net daily gains of 6.0%.. which is clearly stupid, considering the growing inventories.

3.41pm.. marginal new cycle high sp'2085... but the VIX sure ain't breaking the 12s again.

Nothing has changed... I'm still seeking renewed weakness from here. 

3.52pm.. USD +0.8% in the DXY 97.80s.... and that will be a problem... not least for commodities.

Regardless of the closing hour new high.... market is building a short term top.