Wednesday 29 August 2012

Closing Brief

Another day of nothing.

The closing hourly index charts...





Dull. That is the only way to call it.

The VIX closed up 3% to around 17., still remarkably low considering an uncertain autumnal period ahead.

It would seem unlikely tomorrow will be any different than today.

More later

2pm update - micro moves

We are indeed back to zero volume meltup. No news, no nothing, which merely allows the bots to take over.



We remain in the centre of a broad up channel from the June 1266 low. Baring a break of 1350, primary trend indeed is most certainly bullish.
Back after the close.

12pm update - still minor noise

Pretty dull isn't it? A few pts up..a few pts down. Perhaps..the dullest trading month in a few years. I look forward to September, it can't be any less exciting than this.

sp'daily3, rainbow, news

VIX, daily


Sp'1350 is clearly an obvious target level for the bears, yet that looks a long way down. I been endlessly mentioning 'need 1340s' for weeks now, and nothing has changed in that respect.

With Labor day next Monday (US market shut!), once Benny is outta the way late Friday morning, it might be worth just turning it all off then.

VIX is up a little, but it'll be really difficult to break over 18 - a key level on the weekly cycle..

*metals and oil remain weak, but so far, its only a minor fall.

back at '2pm

10am update - another quiet day

Good morning. With still two more days until the Bernanke appears at the hole, it looks we have another dead day ahead of us. Urghh




Downside remains 1380', that would make for a post-Bernanke 'disappointment' reaction, but I sure can't see 1380' breaking this cycle. Just look at how low the MACD (blue bar histogram) cycle is already.

Regardless of what happens Friday, it doesn't seem like anything going to happen today.

*Metals a touch weak, they sure don't indicate QE in September.
back at 12pm

Transports.....RED !

To close today, lets take a look at the transportation index, which yesterday turned red on the rainbow chart!

Transports, rainbow, monthly, 6yr

Trans, weekly


If the tranny can close this Friday at or below the current level of 5061, then we will indeed get a VERY important sell signal..a red candle!

This would be the first monthly red close since last September.

If the 'old leader' is still indeed the leader, then we should expect the rest of the market to follow in September.

As for the state of the other indexes, they only have blue candles on their respective rainbow charts, and the sp' is actually outright bullish-green. So, there it is certainly a mixed situation.

So, lets see if we can close this Friday - and the month, with a red candle. A close this Friday under the big 5000 level would be particularly welcome. It would break the triangle - as seen on the weekly chart, and opens up a move to break the June low of 4800.

The new red candle offers the very first official sign of weakness, the Autumnal downside target for the transports is at least 4500.

Goodnight from London

Daily Index Cycle update

A quiet day in market land, lets take a quick look at the sp'daily chart - with added scenarios!

Sp'daily5b - scenarios


The scenarios on this chart arguably cover most of the near term outcomes. With the Bernanke due to speak within a few days, its no wonder things are dead quiet. Everyone - especially those algo-bots, are merely in a holding mode.

From a MACD (blue bar histogram) cycle perspective, we've already come down quite a way, and this has to be seen as a real problem for the doomer bears. It seems VERY unlikely we can break considerably lower on a 1-2 week basis.

Right now, I prefer scenario C'. I certainly think 1380 will be too hard to break in the current cycle. The only hope for bears is that we'll put in a slightly lower high, and then rollover sharply around mid-September. Of course, for any index declines below 1350, we're going to need to see VIX back above 20

A little more later.