Thursday, 21 November 2019

Awaiting more spooky news

US equity indexes closed a little weak, sp -4.9pts (0.2%) at 3103. Nasdaq comp' -0.2%. Dow -0.2%. The Transports settled -0.1%. Near term outlook offers another wave lower to the sp'3050/46 zone.

sp'daily5



VIX'daily3



Summary

US equities opened in minor chop mode, and leaned to 3094. Price action was choppy into the afternoon.

Volatility picked up, with the VIX settling + % at 13.   .

Yesterday saw a break of s/t rising trend, with s/t equity price structure of a bear flag. If the Wednesday low of 3091 can be taken out - whether tomorrow, or early next week, it will offer a fast run to next downside gap of the 3050/36 zone, which might equate to VIX 17/18s. 

More 'spooky news' - namely... US/China trade related, appears due within the immediate term. If the Chinese make it clear 'no phase'1 trade deal' before year end, the market will broadly slide into end month/early December.

Sidenote: It should be clear, the US President has been increasingly intolerant of any degree of equity downside in recent months. If we do cool to the mid/low sp'2900s, it will be fascinating to see how Trump reacts on Twitter. 

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Wednesday, 20 November 2019

Downside break

US equity indexes closed broadly weak, sp -11pts (0.4%) at 3108. Nasdaq comp' -0.5%. Dow -0.4%. The Transports settled -1.4%.

sp'daily5



VIX'daily3



Summary

US equities opened a little weak, but quickly slipped into minor chop mode. Things turned interesting in the 12pm hour...


... with the mainstream realisation that phase one won't likely be signed before year end, the market broke lower. S/t rising trend was taken out, along with a few other aspects of support.

The afternoon saw a low of sp'3091 with VIX 14.17, before a moderate recovery into the close. Volatility picked up, with the VIX settling --0.6% at 12.78.

Regardless of overnight/early Thursday, today did see a key downside break, and it offers a broader washout into early December. We have SIX downside gaps, with the sixth of 2911/2893. Whilst that doesn't have to be tagged... the historical percentages favour it. 
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Departing the capital of geo-political chaos

Another cold day in the London metropolis
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Tuesday, 19 November 2019

Is Trump a candidate here too?

US equity indexes closed a little mixed, sp -1.9pts (0.1%) at 3120. Nasdaq comp' +0.2%. Dow -0.4%. The Transports settled -0.3%.

sp'daily5



VIX'daily3



Summary

The day began once again with a pre-market message from the US President...


Indeed, Nasdaq remains powerfully higher this year, and is the leader of the US indexes.

Equities opened positive, with new historic highs in the SPX, Dow, and Nasdaq comp'. However, the gains were shaky right from the start, with most indexes turning fractionally negative by 10am.

The afternoon saw further minor chop, leaning fractionally weak into the close. Volatility picked up a little, with the VIX settling +3.2% at 12.86.


Is Trump a candidate here too?

On first glance, you might actually wonder if the next UK election is between Farage, Johnson, and Trump. Part of this morning's political mail from...


... the Liberal Democrats, who are the UK's third biggest party. Whilst they have zero chance of winning, they will be more than willing to form a coalition with Corbyn/Labour party. It is very much the case that Trump is very much a part of UK political chatter.

The UK General election is due Thurs' Dec'12th. Results will be pouring in (appropriately) in the early hours of Friday the 13th. A clear result should be known by around 7am GMT (2am EST).

Ohh, and for the record, I'm leaning to a Corbyn/Labour 'shock victory'. Ironically, the market should be pleased with that, as any BREXIT bill would likely have a 'popular vote' tagged to it, and the UK populace would vote against ANY such bill, and thus remain in the EU.

... and if the UK remains in the EU... stronger GBP and Euro, weaker USD... and a weaker USD would pressure almost everything upward. 
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Monday, 18 November 2019

Very good and Cordial

US equity indexes closed fractionally higher, sp +1pt (0.05%) at 3122. Nasdaq comp'+0.11%. The Transports settled +0.02%.


sp'daily5



VIX'daily3



Summary

The week began in pre-market with minor gains, but price took a moderate swing lower on a CNBC report that China was pessimistic about reaching a trade deal.


Very good and Cordial

In mid morning it was announced Powell had met with Trump and Mnuchin. It didn't take long for the US President to issue his personal summary via Twitter...


The fed issued their own version...

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This morning's surprise meeting sure would have made for interesting viewing. I've no doubt all three of them were rather annoyed with each other. Trump increasing states he wants negative rates, which Powell is (currently) against. Mnuchin... well, he'd surely rather be anywhere else. 

The afternoon saw new historic highs (if fractional) in the SPX, Dow, and Nasdaq comp'.

Volatility remained subdued, with the VIX settling +3.4% at 12.46.
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Saturday, 16 November 2019

Weekend update - US equity indexes

It was a bullish week for most US equity indexes, with net weekly changes ranging from +1.2% (Dow), +0.9% (SPX), +0.8% (Nasdaq comp'), +0.6% (NYSE comp'), to -1.7% (Trans).


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

sp'500


The SPX climbed for a sixth consecutive week, breaking a new historic high, settling +27pts (0.9%) at 3120. Price momentum continues to tick upward. M/t rising trend from Dec'2018, will be in the 2940s next week.


Nasdaq comp'


Tech climbed for a seventh consecutive week, +65pts (0.8%) at 8540.


Dow


The mighty Dow climbed for the 5th week of 6, +323pts (1.2%) to a new historic high of 28004.


NYSE comp'


The master index climbed for a sixth week, settling +84pts (0.6%) to 13492. The Jan'2018 historic high of 13637 is very near.


Trans


The old leader struggled, settling net lower for the week by -190pts (1.7%) to 10876.



Summary

Four indexes were net higher for the week, with one net lower.

The Dow is leading the way higher, whilst the Transports was sig' lower.

The SPX, Dow, and Nasdaq comp' broke new historic highs.

More broadly, all five indexes are holding above their respective monthly 10MA.

YTD price performance:


The Nasdaq comp' continues to lead for the year, currently +28.7%. The SPX +24.5%, with the Dow +20.0%. The NYSE comp' and Transports are both +18.2%.



Looking ahead

Earnings:

M -
T - HD, KSS, TJX, MDT, URBN
W - TGT, LOW, LB
T - M, JWN, GPS
F - FL, SJM
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Econ-data:

M - Housing market index
T - Housing starts
W - EIA Pet' report, FOMC mins (2pm)
T - Weekly jobs, Phil' fed, existing home sales, leading indicators
F - PMI comp', consumer sent'
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Friday, 15 November 2019

Historic highs into the weekend

US equity indexes closed moderately higher, sp +23pts (0.8%) at 3120. Nasdaq comp' +0.7%. Dow +0.8%. The Transports settled +0.05%.

sp'daily5



VIX'daily3



Summary

US equities opened moderately higher, and it was enough to generate new historic highs in the SPX, Dow, and Nasdaq comp'.

The US President appeared at 10.17am EST...


With a follow up...


.. and Peter Schiff making a guest appearance. It remains something of a travasty how one of the few to see the 2008 collapse coming, remains largely blacklisted by the mainstream media. Further, Trump continues to periodically tout Charles Payne, whose key stock pick for 2008 was Washington Mutual.

The afternoon saw another wave higher to sp'3120 into the OPEX settlement. Volatility remained subdued, the VIX settling -7.7% at 12.05.
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Thursday, 14 November 2019

Broadly headed

US equity indexes closed a little mixed, sp +2pts (0.1%) at 3094. Nasdaq comp' -0.04%. The Transports settled +0.3%. Near term outlook will lean to OPEX chop into the weekend.

sp'daily5



VIX'daily3



Summary

Once more, the day began in pre-market with a market message from the US president..


US equities opened in minor chop mode, with Trump continuing...


... even taking a (rather amusing) little swipe at Powell.

Price action took a swing lower in late morning. The afternoon saw further chop, leaning fractionally higher in the late afternoon. Volatility picked up just a little, with the VIX settling +0.4% at 13.05.


Broadly headed

You recognise where we are broadly headed, right? The path ahead - within the twilight zone, is a dark and cloudy one, filled with a great many surprises. Some good..... most.. arguably not. 

Another flying monster, departing the capital of geo-political chaos

Along with a fair few others recently, yours truly has been wondering what financial institutions have been getting the Fed's REPO money/support? Powell (ironic name) of the Gold Anti-Trust Committee (GATA) requested the Federal Reserve Bank of New York to reveal the details. The response was not surprising...


The NY branch of Print Central said we won't find out what institutions have been making use of the REPO for around two years. By late 2021, the very institution/s currently in distress, might already have gone under. Deutsche Bank is the obvious prime candidate, but almost all of the UK/EU financials are on life support, as the NIRP policy of the ECB is ironically destroying the very institutions they were tasked to protect.

Regardless of Friday, and the remainder of the year, the broader path that we're headed remains pretty clear. The Fed will continue to print, lower rates, and keep its secrets. We'll also see ever more stronger capital market quakes.

The US President will likely become ever more tied to every little intraday (even overnight futures) equity swing. Right now, I can't see who will win the 2020 election, but whomever 'wins', they face monstrous fiscal problems. But hey, why worry, when the fed will buy whatever amount of bonds are issued?

On the plus side... its all very entertaining, not least the ongoing sideshow of Leon Cooperman and Democrat contender... Elizabeth Warren.
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Headed eastward

A moment of serenity

A brief glimpse... between the clouds


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Wednesday, 13 November 2019

Rate cut four?

US equity indexes closed rather mixed, sp +2pts (0.1%) at 3094. Nasdaq comp' -0.1%. Dow +0.3%. The Transports settled -1.1%.

sp'daily5



VIX'daily3



Summary

US equities opened moderately weak. The release of Powell's prepared remarks saw equities claw back upward to fractional gains.

Powell appeared at 11am...


... and carefully danced the fine line, trying not to upset the capital markets. As for the 'new normal', normal within the twilight zone remains the stuff of nightmares, but most have lost sight of what once would have been deemed so.

The afternoon saw a swing lower on a spooky trade related headline. For now, there is no real sign that phase'1 will be signed off before year end. For now, the market remains largely in denial, not that any of it (on a $ basis) matters to the broader economy anyway.


Rate cut four?

In recent days I've been increasingly dubious about a fourth rate cut.

 
The mainstream certainly aren't expecting one. Even if we see a full retrace to tag all the downside gaps to sp'2911/2893, I no longer expect a Dec'11th rate cut.

Implications: no rate cut will lean bearish the precious metals and related miners. It will lean bullish equities, especially the financials.

To be clear though, another 1-2 rate cuts can be expected in 2020, along with further QE. In addition to ongoing T-bill and monstrous overnight REPO funding, I'd expect T-bond buying to commence before the Nov'2020 election.
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