Tuesday 31 July 2018

Settling July positive

US equity indexes settled July on a broadly positive note, sp +13pts (0.5%) at 2816. The two leaders - Trans/R2K, settled +1.3% and +1.0% respectively. Near term outlook offers renewed sig' cooling to the sp'2760s, which should equate to VIX 15/16s. New historic highs (>2872) look probable in August.

sp'daily5



VIX'daily3



Summary

Equities ended the month on a broadly bullish month. Today was arguably just a bounce within a s/t cooling wave from 2848, that should see the sp'2760s (with VIX 15/16s). Volatility was in cooling mode, settling in the upper 12s.

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Monday 30 July 2018

Starting weak

US equity indexes closed broadly weak, sp -16pts (0.6%) at 2802. Nasdaq comp' -1.4% at 7630. The two leaders - Trans/R2K, settled -0.2% and -0.6% respectively. Near term outlook offers minimum technical target of sp'2768 (with VIX 15/16s), before resuming broadly upward.


sp'daily5



VIX'daily3



Summary

Equities opened in minor chop mode, and with a clear absence of more than a few willing bulls, the market resumed lower. There were a couple of mini ramp attempts, but the day closed on a broadly weak note. Tech was notably weak, having broken rising trend that stretches back to April.

Volatility continued to climb, with the VIX settling +9.4% at 14.26. S/t outlook offers the sp'2760s, which should equate to VIX 15/16s. The key 20 threshold looks out of range.
--

Bonus chart: Australia, monthly


With just one trading day left of July, the Australian equity market is set for a fourth consecutive net monthly gain. Its a subtle bullish sign for other world markets, esp' Brazil and Russia.

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Saturday 28 July 2018

Weekend update - US equity indexes

It was a very mixed week for US equity indexes, with net weekly changes ranging from +2.01% (Trans), +1.57% (Dow), +1.06% (nyse comp'), +0.61% (sp'500), -1.03% (nasdaq comp'), to -1.97% (R2K). Near term outlook offers cooling of around 1-2%, before resuming upward.

Lets take our regular look at six of the main US indexes

sp'500


Despite ending the week on a rather bearish note, the sp' managed a fourth consecutive net weekly gain, +0.61% at 2818. The intra week high of 2848 was a mere 24pts shy of the Jan' historic high.

Best guess: s/t cooling to the 2760s, before resuming upward. New historic highs look on track in August. Big target remains the 2950/3047 zone, which is where I anticipate the market becoming seriously stuck.
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Nasdaq comp'


It was a very mixed week for the Nasdaq comp', breaking a new historic high of 7933, but swinging lower into the weekend, settling -1.06% at 7737. S/t bearish with the main market. The 8000s still look due in August.


Dow


The mighty Dow climbed for a fourth consecutive week, +1.57% to 25451, with a new multi-month high of 25587. S/t bearish with the main market. Note underlying macd (blue bar histogram) cycle has turned positive.


NYSE comp'


The master index gained 1.03% to 12921. S/t bearish, but new historic highs look viable in early September.


R2K


The R2K unraveled into the weekend, settling -1.97% to 1663. S/t bearish, with a viable test of the 1610 price threshold. Alarm bells with any closes <1600, but that does not seem likely.


Trans


The 'old leader' saw a very significant net weekly gain of 2.01% to 10957. Price momentum is set to turn positive within 1-2 weeks.



Summary

Four indexes saw net weekly gains, whilst two settled sig' lower.

The Nasdaq comp' broke a new historic high.

The broader m/t trend remains unquestionably bullish.

YTD performance:


The Nasdaq continues to lead, +12.1%, with the sp +5.4%, and the nyse comp' being the laggard, +0.9%.
--


Looking ahead 

Another truck load of earnings are due, notably: CAT, STX, AAPL, TSLA, X, SQ, PBR



-
M - Pending home sales
T - Pers' income/outlays, employment costs, Case-Shiller HPI, Chicago PMI, consumer con'
W - Vehicle sales, ADP jobs, PMI/ISM manu', construction, EIA Pet' report.

At 2pm the Fed' will issue a press release of the latest FOMC. No rate hike can be expected, but the statement should give an update that the QT program is at/close to hitting $50bn a month. There will NOT be a press conf'.

T - Weekly jobs, factory orders
F - Monthly jobs, intl' trade, PMI/ISM serv'
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*the next post on this page will likely appear 5pm EST on Monday.

Friday 27 July 2018

The infamous Kudlow

US equity indexes closed broadly weak, sp -18pts (0.6%) at 2818. The two leaders - Trans/R2K, settled -0.2% and -1.9% respectively. VIX settled +7.3% at 13.03. Near term outlook offers sp'2768, before resuming broadly upward.


sp'daily5



VIX'daily3



Summary

US equities opened in minor chop mode, and price action was a little shaky. With a break of the s/t rising trend, prices spiraled lower, with an afternoon low of 2808. There was a moderate late day choppy bounce to settle at 2818.

Volatility picked up, with the VIX seeing the 14s, but settling in the low 13s. S/t outlook offers minimum technical necessity of sp'2768, which should now equate to VIX 15/16s.
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The infamous Kudlow

In early morning, Trump decided to hold a little meeting with the media hacks...



Trump proudly touted the first print of Q2 GDP that came in at 4.1%. Things got far more interesting with ex-CNBC 'contributor', Larry Kudlow - Director of the President's National Economic Council.

The following will no doubt be widely referenced in the years ahead....

"This is a boom that will be sustainable. Frankly, as far as the eye can see. This is no one shot, ever" - Kudlow, L. July 27th 2018.


Financial historians will look back on this as just another classic delusion by central government that believes it can negate the natural economic cycle. Kudlow is widely recognised as touting 'no recession' as late as summer 2008. He was economically wrong then... and the notion the current boom is sustainable, is utter nonsense.

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Thursday 26 July 2018

Mixed Thursday

US equity indexes closed moderately mixed, sp -8pts (0.3%) at 2837. Nasdaq comp' -1.0% at 7852. The two leaders - Trans/R2K, settled +0.8% and +0.6% respectively. VIX settled -1.2% at 12.14. Near term outlook offers chop into the weekend.


sp'daily5



VIX'daily3



Summary

It was a mixed Thursday, with sig' weakness in the Nasdaq, but moderate strength in the Dow and R2K. Volatility remained very subdued, melting lower for a fifth consecutive day, settling in the low 12s. S/t outlook offers chop into the weekend, but minimum technical necessity of sp'2768 remains due, and that will likely equate to VIX 14/15s.
--

Bonus chart: Germany, monthly


With just three trading days left of the month, the DAX is currently +4.1% at 12809. A July settlement back above the key 10MA would give some extra confidence for Aug/Sept.

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Wednesday 25 July 2018

Late day surge

US equity indexes closed broadly higher, sp +25pts (0.9%) at 2846. The two leaders - Trans/R2K, settled +2.3% and +0.3% respectively. Near term outlook offers a cooling wave before the weekend, but anything <2800 looks overly difficult, even with a looming full-blood moon!


sp'daily5



VIX'daily3



Summary

It was mostly just another day of minor chop... leaning on the positive side. Yet, the closing hour saw news of EU trade concessions, and the market saw a hyper spike to 2848, a mere 24pts shy of the January historic high.Volatility was naturally subdued, with the VIX cooling for a fourth day, settling in the low 12s.
--

Bonus chart: Brazil, monthly


After a rough May/June, the Bovespa is currently +10.2%. It does bode indirectly bullish for other world markets.
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Tuesday 24 July 2018

Very mixed Tuesday

US equity indexes closed very mixed, sp +13pts (0.5%) at 2820. The two leaders - Trans/R2K, settled -1.5% and -1.0% respectively. VIX settled -1.7% at 12.41. Near term outlook still threatens a 'technically necessary' mini washout to sp'2768, but that will be a challenge, as earnings are coming in broadly superb.


sp'daily5



VIX'daily3



Summary

It was very mixed Tuesday in equity land. The sp'500 saw a new multi-month high of 2829.99, with  the Nasdaq breaking a new historic high. Yet, there was some distinct cooling into the mid afternoon. The Trans and R2K both settled sig' lower, with tech effectively flat. Further, the settling sp'500 candle was of the black-fail doji type, which leans to the bears across the next few days.

Volatility continues to churn within the 13/11s. A sporadic spike to the mid 14s/15s will be a threat for the remainder of the week, even as earnings continue to come in broadly superb.
--

Bonus chart: China, monthly


Yes, I'm highlighting China again! With news of further fiscal stimulus, the Shanghai comp' is +2.0% at 2905. The current candle is very bullish, with a clear spike floor from 2691. It does bode rather well for other world markets into September.

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Monday 23 July 2018

Positive chop

US equity indexes closed on a somewhat positive note, sp +5pts (0.2%) at 2806. The two leaders - Trans/R2K, settled +0.7% and +0.1% respectively. VIX settled -1.9% at 12.62. Near term outlook still offers the sp'2760s, before settling the month >2800, with new historic highs due in August.


sp'daily5



VIX'daily3



Summary

The week began on a pretty subdued note. Whilst the sp' did break last week's low to 2795, there was afternoon upward melt, with most indexes (Dow was an exception) moderately higher. Volatility opened in the mid 13s, but with equities leaning back upward, the VIX melted back to the mid 12s. S/t outlook offers the sp'2760s, which would likely equate to VIX spiking to the 14/15s.
-


Bonus chart: China, monthly


With six trading days left of the month, the Shanghai comp' has turned net positive, +0.4% at 2859. The PBOC are meddling of course, not least via the Yuan fix. Mainstream consensus is that things would turn 'wild' with a break >7.00 to the USD. That really isn't far up... just 3% or so.

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Saturday 21 July 2018

Weekend update - US equity indexes

It was a broadly bullish week for US equity indexes, with net weekly changes ranging from +1.85% (Trans), +0.58% (R2K), +0.16% (nyse comp'), +0.15% (Dow), +0.02% (sp'500), to -0.07% (nasdaq comp'). Near term outlook offers brief cooling, but broadly bullish into late summer.

Lets take our regular look at six of the main US indexes

sp'500


The sp'500 managed a gain of 0.5pts (0.02%) to settle at 2801. Note the 10MA at 2756, that will offer support in the 2760s next week. Upper bollinger will be offering the 2900s by late August.

Best guess: with opex out of the way, s/t downside of around 1.5% to the 2760s. Broadly though, new historic highs (>2872) look due in August. Big target remains the 2950/3047 zone, which is where the market will very likely get stuck.


Nasdaq comp'


The Nasdaq was the laggard this week, settling -0.07% at 7820, but did achieve a new historic high of 7867. Upper bollinger will be offering the 8000s into end month.


Dow


The mighty Dow settled +0.15% at 25058. Note upper bollinger resistance in the 25500s. Further, note underlying macd (blue bar histogram) cycle, which is set to turn positive before end month. In theory, there is a realistic upside of 5-7 weeks, which will take us into early September.


NYSE comp'


The nyse settled +0.16% at 12789. Weekly price momentum has turned net positive for the first time since late January. This is a subtle, but rather bullish sign for the broader market this summer.


R2K


The R2K saw a moderate gain of 0.58% to 1696. New historic highs look viable within 1-2 weeks.


Trans


The old leader - Transports, was the leader this week, with a very significant net gain of 1.85% to 10741. Price momentum should turn positive by early August. WTIC/fuel prices remain a concern, and whilst I expect that to be a drag on the tranny, it doesn't mean the index will be net lower.



Summary

Five indexes were net higher, with one net lower.

The Nasdaq comp' broke a new historic high.

Whilst a brief cooling wave is a threat next week, more broadly, most indexes look set for new historic highs by September.

YTD performance:


The Nasdaq continues to lead the way, currently +13.3%. The NYSE comp' is the laggard, -0.1%.
--


Looking ahead

A busy week is ahead, not least with a truck load of corp' earnings, notably: GOOGL, FB, AMZN, INTC, XOM, and TWTR.



M - Existing home sales
T - FHFA house price index, Richmond Fed'
W - New home sales, EIA Pet' report
T - Weekly jobs, Durable Goods Orders, Intl' trade
F - Q2 GDP (first print), consumer sentiment.
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*the next post on this page will likely appear 5pm EST on Monday.

Friday 20 July 2018

Opex chop

US equity indexes closed fractionally weak, sp -2pts (0.1%) at 2801. The two leaders - Trans/R2K, settled -0.1% and -0.3% respectively. VIX settled -0.1% at 12.86. Near term outlook offers cooling of around 1.5% to the 2760s.

sp'daily5



VIX'daily3



Summary

Some Trump tweets spooked the market in pre-market, but the half-life of market upset is ever shorter, with the sp' turning fractionally positive by 9.45am. The rest of the day was micro chop. The opex settlement of 2801 was pretty close to perfect for the market makers.

Volatility was naturally subdued, melting lower, settling in the upper 12s.

Goodnight from London
--
The weekend post will probably appear Saturday 12pm EDT.

Thursday 19 July 2018

No wool for us!

US equity indexes closed moderately mixed, sp -11pts (0.4%) at 2804. The two leaders - Trans/R2K, settled +0.4% and +0.6% respectively. Near term outlook offers an opex settlement around 2805, with minimum technical necessity of 2768.


sp'daily5



VIX'daily3



Summary

Equities opened moderately weak, but then resumed back into micro chop mode. The closing hour saw another fractional break of soft rising support. VIX remains relatively subdued. Once opex is out of the way, a cooling wave to sp'2768 with VIX 14s is due.
-

Dr Amp...



Bullish silent running drapes.

Goodnight from London

Wednesday 18 July 2018

Wednesday

US equity indexes closed broadly positive, sp +6pts (0.2%) at 2815. The two leaders - Trans/R2K, settled +2.3% and +0.3% respectively. VIX settled +0.3% at 12.10. Near term outlook offers the low sp'2820s, before a sig' swing lower to the 2760s. Opex will likely delay that until next week.

sp'daily5



VIX'daily3



Summary

US equities opened in minor chop mode, and broadly stayed that way for the day, but leaning on the fractionally positive side.
--
 



I'm sure you can come up with something in regards to those two pictures.

Goodnight from London