Wednesday, 10 July 2013

Equities cruising higher

Another day higher for the US indexes, and the broad mid-term up trend is right back on track. With the sp' in the 1650s, the 1700s are barely 3% away, and that is viable even before this month concludes. With ongoing QE-pomo, bears face incessant problems.

sp'weekly8 - near term bullish outlook


Is there any doubt now that the recent down wave is indeed complete?

I am still seeing a few out there suggest this is going to unravel imminently,, I just don't see that. After all, QE continues, the mainstream delusion that 'everything is okay' is holding, and we're in what are typically 'sleepy' trading months.

The underlying MACD (green bar histogram) on the weekly index charts is ticking higher for the second week, and we're set to go positive cycle in about 2-3 weeks, certainly by early August.

One for the trash bin

Something I was considering in the past few weeks, and I'm certainly aware others have considered it too.

Trans, weekly'3

In my view..the H/S scenario is to be dismissed, with the break into the 6400s. Next key level are the 6600s, and if that is hit, then prime target zone is 7000/7200.

Looking ahead

There is wholesale trade data at 10am (not that the market will likely care), and the EIA oil report at 10.30am. What will be most important tomorrow are the FOMC minutes, released at 2pm. The last few occasions have seen the market drop rather significantly - on algo-bot interpretation of the Fed-speak. Further, the Bernanke is speaking around 4pm.

*there is mid-size QE of $3bn this Wednesday...bears beware!

With more QE tomorrow, the market will very likely be testing the 1660s. However, there is very stiff resistance at that level, and the market might easily use it - along with the FOMC minutes as an excuse for 2-3 day down cycle.

sp'daily6 - bollinger/keltner bands

If the market does sell down (briefly into Thurs/Friday), the 50 day MA @ sp'1628 should offer VERY strong support for the bulls.

*I am content on the sidelines, but seeking to pick up an index/Oil long.

Goodnight from London