Monday 11 January 2016

Pre-Market Brief

Good morning. US equity futures have swung from an overnight low - equiv' to sp -18pts @ 1904, to +7pts, we're set to open at 1929. Commodities remain broadly weak, with Copper losing the $2.00 threshold, whilst Oil is -0.8% in the $32s.


sp'60min


sp'daily3


Summary

*first soft resistance remains the hourly 10MA, which this morning will be in the 1940/35 zone.
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We're clearly seeing the first attempt to clarify that 1920/00 zone is a short term floor.

There is NO question though, broadly.. we're headed much lower in the weeks and months ahead. The sp'1650/1550 zone looks extremely probable by May/June.

For now... there is clearly threat that an overnight ES low is in at 1893.

If that is a low, then a 50% retrace of the down wave from 2081 offers the 2000/1999 threshold.

I'd argue it is overly risky a bounce to play.. as we might simply resume falling later today though.
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Best guess... the cash market to test the overnight low in the 1905/00 zone... and then a bounce into opex, and probably a week beyond.

Sustained action above the monthly 10MA (2030s) and indeed, the sp'2K threshold looks out of range for at least EIGHT months.

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Update from Oscar



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Doomer chat, Hunter with Kirby



As ever, make of that, what you will. I still think the gold bugs are yet to capitulate... and the notion of a USD collapse is ludicrous. Would you rather hold Euros or Yen? Of course, in the minds of Gold bugs, we will all be shopping at Walmart with gold/silver coins in our pockets. There is higher probability of me winning the powerball each week for a year.
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Overnight action...

Japan: CLOSED
China: -5.3% @ 3016. A loss of 3K will confirm that the 2500s are coming... pretty soon.

Germany: currently +0.5% in the 9900s. Sustained action >10K looks unlikely for months.
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... and Bowie died this weekend :(  
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Good wishes for the trading week ahead
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8.47am.. sp +10pts... 1932.

Indexes look vulnerable to turning red later today.  For the moment, there is ZERO reason - other than technical, to expect a bounce.

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Oil remains a problem for the equity bulls... the loss of the $30 threshold looks a given.. just a matter of in this cycle.. or the next.

*the fact the market was unable to rally on 'good jobs news' remains a pretty bearish event.

... here comes Cramer...


9.06am  Well, so far no one wants to buy the market above sp'1935 or so. 

Oil is looking problematic, -1.3%.


9.40am... EXITED TVIX-long.... .   I just don't like the smaller cycles setup... nevermind the overnight futures reversal.