Monday, 17 September 2018

Headed to the moon

US equity indexes closed on a broadly weak note, sp -16pts (0.5%) at 2888. Nasdaq comp' -1.4% at 7895. The two leaders - Trans/R2K, settled -0.9% and -1.1% respectively. VIX settled +13.3% at 13.68. Near term outlook offers a turnaround Tuesday, and more broadly... this market still looks headed for the moon into 2019.


sp'daily5



VIX'daily3



Summary

The week began on a weak note, with most indexes opening fractionally lower, and leaning increasingly weak into the mid afternoon. Volatility picked up, but the VIX is still only seeing the 13s, which does not merit any mainstream hysteria.
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Bonus chart: China, monthly


With an overnight decline of -1.1%, the Shanghai comp' is currently net lower for the month by a very significant -2.7%. The Jan/Feb' 2016 low of 2638 is indeed very near. Under that... psy' levels 2500, then 2k. I remain wondering just what the communists are thinking. 
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Headed to the moon

This evening, 6pm PT (2am BST), SpaceX will announce their first private/commercial passenger, who will be on the BFR that will do a loop around the moon. I'd believe that launch will be in 2020/21... which really isn't that far away.

Details/webcast: https://www.spacex.com/webcast




I can't emphasise the importance of BFR, a reuseable vehicle able to do intercontinental hops for Earth, or for travel to the moon and Mars. Massive long term implications for humanity itself.
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Yours truly is rather hypnotised by any moon light. The following three pics (no photoshop, all untouched), taken with a Canon 730. The first is natural, the second is with 100x zoom, and the third with max zoom of 160x.  Frankly, I think they are pretty incredible for what is just a handheld consumer camera.

Natural view

100x zoom

160x (40x optical, with 4x digital).

Ohh, and the next full moon is next Monday, Sept'24th, a day after the official start of autumn.

Goodnight from London
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Saturday, 15 September 2018

Weekend update - US equity indexes

It was a bullish week for US equity indexes, with net weekly gains ranging from +1.9% (Trans), +1.3% (Nasdaq comp'), +1.1% (sp'500, nyse comp'), +0.9% (Dow), to +0.5% (R2K). Near term outlook offers new historic highs.


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

sp'500


The sp' saw a net weekly gain of 33pts (1.1%), settling at 2904. Whilst early next week might well see a brief foray back into the 2880s, the 2920/30s do look viable, with the 2940/50s by end month.


Nasdaq comp'


The Nasdaq saw a net weekly gain of 1.3% to 8010. Note the 10MA at 7881, currently overlapped by rising trend from the April low.


Dow


The mighty Dow gained 0.9% to 26154. New historic highs (>26616) are just 1.8% higher. Any price action above the key fib' of 26702 (>26800s to be decisive) will offer far higher levels in 2019, to 33/34k.


NYSE comp'


The master index saw a net weekly gain of 1.1% to settle at 13050, the highest weekly close since late January. It bodes well for the main market into the autumn.


R2K


The second market leader - R2K, was the laggard this week, higher by a moderate 0.5% to 1721. The 1800s look due by mid/late November. R2K @ 2K looks due by mid 2019.


Trans


The 'old leader' - Transports, was the leader this week, settling +1.9% at 11570, having broken a new historic high of 11623. If WTIC does break new multi-year highs (>$75.27) - as seems probable, the transports will be pressured, although that does not mean the sector/index will be net lower in the weeks/months ahead.



Summary

All six of the main US equity indexes saw net weekly gains

The Transports and Nasdaq lead the way, with the Dow and R2K lagging.

The Transports broke a new historic high, on 4 of 5 days.

The m/t trend is unquestionably bullish, as the market is battling against 'offshore concerns', such as Turkey. Trade/tariffs remain a key issue, but a US agreement with Canada and China look highly probable.

The US midterms will be a brief issue in early November, but once that is out of the way, the market will have a clear run into year end. Original target of sp'3245 looks just about within range.

YTD performance:


The Nasdaq continues to lead the way, currently net higher for the year by a powerful 16.0%, with the R2K +12.1%. The sp'500 is +8.6%, with the Dow +5.8% and the NYSE comp' +1.9%. Its notable that the Transports has been catching up since late June, currently +9.0%.
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Looking ahead 

Key earnings: FedEx (FDX), Oracle (ORCL) Mon', Micron Tech' (MU), Thurs' in AH.

M - Empire State manu'
T - Housing market
W - Housing starts, EIA Pet' report
T - Weekly jobs, Phil' fed, existing home sales, leading indicators.
F - *QUAD-OPEX*

*Friday Sept'21st will be 'open day' at http://subscriber.permabeardoomster.com
First unlocked post will be the pre-market brief at 8.30am. 
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Have a good weekend
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*the next post on this page will likely appear 5pm EDT on Monday.

Friday, 14 September 2018

Still twitchy on trade

US equity indexes closed a little mixed, sp +0.8pts at 2904. Nasdaq comp' -3pts to 8010. The two leaders - Trans/R2K, settled +0.9% and +0.4% respectively. VIX settled -2.4% at 12.07. Near term outlook offers a minor retrace to around 2888, before resuming to new historic highs in the 2920/30s.

sp'daily5



VIX'daily3



Summary

It was mostly just another day of minor chop in equity land, as we're still seeing the market rather twitchy to sporadic trade chatter... not least from Trump.


It is the case though that the reactive down waves are usually only moderate and brief.

Equity bears should keep in mind that a US/Canada trade agreement announcement, is viable at ANY time, and it would likely pull the main market to around sp'2940/50s before end month. A US/China agreement is clearly far more important. Many do appear to recognise the market could see an end year pop of 10%, and that would get us real close to my original year target of 3245.
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Goodnight from London

*the weekend post will appear Sat'12pm EDT.
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Thursday, 13 September 2018

Tepper Thursday

US equity indexes closed a little mixed, sp +15pts (0.5%) at 2904. Nasdaq comp' +0.7% at 8013. The two leaders - Trans/R2K, settled -0.4% and -0.1% respectively. VIX settled -5.8% at 12.37. Near term outlook offers new historic highs, with the sp'2940/50s viable by end month.

sp'daily5



VIX'daily3



Summary

It was a day for the equity bulls, with the sp' opening a little higher, and building moderate gains into the afternoon. The VIX was naturally subdued, melting lower for a fourth consecutive day.

Meanwhile...


Tepper's appearance on the lunchtime show was pretty interesting. Whilst he has cut back on many stock positions, he is still long Micron Tech' (MU), and its one of his biggest positions. Tepper highlighted many of the same reasons he likes the stock as I have. Further, even if you consider worse case of earnings cut in half, that still offers annual EPS of $6.00. On any basis, that would still leave the stock crazy cheap. The stock saw an extra kick higher on this mainstream chatter, with an intra high of 44.49, and settling +4.5% at $43.62.

A grander perspective: Micron Tech', monthly, 20yr


The m/t trend has been clearly broken this month, and cyclically... it ain't pretty, with a bearish macd cross due in October. However, if Micron can rebound into end month - preferably with a settlement >50.00, then the bulls can start to get confident again. Things will turn real bullish with a daily close >53.00. Earnings are due Thurs' Sept'20th in AH, and I do expect them to come in fine, with 'reasonable' guidance >$3.00.
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Wednesday, 12 September 2018

Midweek moderate swings

US equity indexes closed a little mixed, sp +1pt at 2888. The two leaders - Trans/R2K, settled -0.2% and -0.1% respectively. VIX settled -0.6% at 13.14. Near term outlook offers upside to the 2900s before the weekend.


sp'daily5



VIX'daily3



Summary

US equities opened in minor chop mode, and stayed that way for almost the entire day. There were a few sporadic swings, notably due to renewed chatter of US/China trade talks. That issue is probably not going to be resolved until November.

Volatility was naturally subdued, with the VIX churning in the 13/12s.
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Bonus, China, monthly


The Wednesday session saw a new low for the year of 2647, with the Shanghai comp' currently -2.5% for the month. Not pretty, and its clearly a drag for US listed stocks such as BABA, BIDU, JD, and TCEHY.
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Ten days until Autumn
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Tuesday, 11 September 2018

Positively subdued

US equity indexes closed moderately higher, sp +10pts (0.4%) at 2897. The two leaders - Trans/R2K, settled -0.2% and +0.1% respectively. VIX settled -6.6% at 13.22. Near term outlook offers a push into the sp'2900s.


sp'daily5



VIX'daily3



Summary

US equities opened moderately lower, but much like last Friday, there was an opening reversal, and stocks battled back upward into the mid afternoon. Once again, the transports broke a new historic high (if only fractional), and it bodes well for the main market into the autumn.

Volatility was naturally subdued, with the VIX melting into the low 13s.
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Bonus chart: Germany, monthly


As things are, the DAX is currently -3.2% at 11970. Its a very borderline situation. Whilst the US market has been able to shrug off weakness in China this year, I'm dubious whether it can do the same if the DAX breaks l/t rising trend. The September settlement will be very important indeed.
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Monday, 10 September 2018

Starting positive

US equity indexes closed rather mixed, sp +5pts (0.2%) at 2877. The two leaders - Trans/R2K, settled +1.8% and +0.2% respectively. VIX settled -4.8% at 14.16. Near term outlook offers further upside to new historic highs.


sp'daily5



VIX'daily3



Summary

The week began on a somewhat positive note. Whilst there weren't many buyers, there were fewer sellers, and price action was mostly leaning positive. Its notable the 'old leader' - Transports, broke a new historic high of 11576 Volatility was subdued, with the VIX melting to the low 14s.

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Bonus chart: China, monthly


China saw an overnight decline of -1.2%, which takes the net monthly change to -2.0%. For now, there is zero sign of a floor/turn.... as the communists don't seem to care.
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13 days until Autumn
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Saturday, 8 September 2018

Weekend update - US equity indexes

It was a broadly bearish week for US equity indexes, with net weekly changes ranging from -2.5% (Nasdaq comp'), -1.6% (R2K), -1.0% (sp'500), -0.8% (NYSE comp'), -0.2% (Dow), to +0.4% (Trans). The m/t bullish trends from early 2016 remain intact.


Lets take our regular look at six of the main US indexes (monthly candle charts)

sp'500


The sp' saw a net weekly decline of -29pts (1.0%) to 2871. The m/t trend from early 2016 remains comfortably bullish. Note the monthly 10MA at 2751, with rising trend (from Feb'2016) currently around 2700. The upper bollinger is offering the 2940/50s in the near term, with giant psy'3K viable by around mid October.

Any weekly closes above the key fib' of 3047 - by mid November, will offer a late year hyper ramp to original target of 3245. I accept that is a long way up (374pts, 13.0%), but we've almost four full months of the year to get there.
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Nasdaq comp'


It was a rough week in tech land, with the Nasdaq comp' net lower by a very significant -207pts (2.5%) to 7902. Note the 10MA at 7435, which is overlapped by rising trend. No concerns unless a monthly close <7400, which is a clear 6% lower.


Dow


The mighty Dow was resilient this week, settling lower by just -0.2% to 25916. Note underlying macd (blue bar histogram) cycle, which remains fractionally positive. No concerns unless a monthly close under the key 10MA, currently around 25k, which also intersects rising trend from early 2016. Any price action >26800 would be decisive, and offer far higher levels, and strongly suggest the sp'500 will follow with a break >3047.


NYSE comp'


The master index settled the week -0.8% to 12911. The key 10MA is nearby, just 2% lower in the 12700s. Its notable that price momentum remains negative (if only fractionally) for a fourth consecutive month.


R2K


The R2K settled -1.6% at 1713. New historic highs are only 1.7% higher, with the upper bollinger offering 1740/50s. The 1800s appear viable in late Oct'/early November.


Trans


The old leader - Transports, was very resilient this week, managing a moderate net gain of 43pts (0.4%) to 11347. Weakness in WTIC (net weekly decline -2.9% to the $67s) clearly helped prop up the tranny. Any renewed upside in WTIC - as seems very probable, will be a drag on transportation stocks, but if the broader market does climb into year end, the transports should be net higher... if a sector/index laggard.



Summary

Five indexes were net lower, with one net higher.

The Trans and Dow were resilient this week, whilst the Nasdaq comp' and R2K were both significantly lower.

All six US equity indexes are maintaining m/t bullish trends from early 2016. The sp'500 has downside buffer of around 5%.

US econ-data and corp' earnings continue to come in broadly fine. Q3 earnings should be good, and help to offset any trade or election concerns. Indeed, once the the US mid-terms (Nov'6th) are out of the way, regardless of the result, the market will be far more able to ramp.

Right now, the only concerns are offshore, especially within the German and Chinese market/economy. Those equity bulls seeking upside into year end, and across much (if not all of 2019) should be seeking a discernible floor/turn in both of these key markets within the near term.
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Looking ahead

Earnings: Kroger (KR), Thurs'

M - Consumer credit
T - Wholesale trade
W - PPI, EIA Pet' report, Fed Beige book
T - CPI, Weekly jobs, US t-budget
F - Retail sales, import/export prices, indust' prod', busin' invent', consumer sent'.
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Have a good weekend
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*the next post on this page will likely appear 5pm EST on Monday.

Friday, 7 September 2018

Weakness into the weekend

US equity indexes closed on a weak note, sp -6pts (0.2%) at 2871. The two leaders - Trans/R2K, settled -0.2% and -0.1% respectively. VIX settled +1.6% at 14.88. Near term outlook offers renewed upside, not least if the US/Canada can reach a trade agreement.


sp'daily5



VIX'daily3



Summary

It was another day of moderate chop, leaning on the weaker side. The sp' opened moderately weak, on mainstream concerns of higher rates, due to increases in average earnings. This is ironic of course, as its the same mainstream that was whining about lack of increases in earnings for the US worker for the better part of a decade.

Volatility saw a pop to the mid 15s, but settled in the upper 14s. The s/t outlook offers renewed upside, and new historic highs (>2916.50) are very much within range next week, not least if the US/Canada reach a trade agreement... as seems a given.
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Just another day closer to autumn
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