Daily Wrap - its quiet out there

The main indexes closed moderately lower, with the sp' slipping just 2.5pts to 1707. The VIX again failed to hold earlier minor upside, closing -1.1% @ 11.84. The market is now in its seventh week to the upside, from the sp'1560 low.


sp'daily5

VIX'daily'3

Summary

A very quiet day in market land, lowest volume of the year (probably). It has to be asked, why would tomorrow be any different?

The original outlook was looking for a multi-week up cycle to max out..this week..and yet, now that we're here..I'm having my doubts. I can't think of anything to motivate the market lower, other than simple exhaustion, but that's never been a good reason across the past four years.

For the moment, I'm very cautious, but I will carefully consider an index short, if we enter the sp'1715-25 zone tomorrow..or later in the week.


Seven weeks up...how many more?

It has to be asked, since its August - a typically quiet month in the market, why would the current rally end now?  Anyway, a particularly bearish outlook is the following...

sp'weekly7

Primary downside target - for September (certainly not this month!) is the lower weekly bollinger, currently @ 1535. By late Sept' that will likely be close to sp'1600. Frankly, its going to be damn tough for the main market to be trading <1600 by the start of October.


Looking ahead

Again, there really isn't any sig' econ-data tomorrow to motivate the market.

However, there is a QE-pomo of $5bn, and that is indeed something the bears should be very mindful of.
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That's all for today.

Goodnight from an overly sleepy London

Closing Biief

The market closed marginally lower, with the sp -2.5pts @ 1707. Near term broad trend remains to the upside, but we are arguably within a day or two of a possible top. The two market leaders - Trans/R2K, closed mixed, -0.7% and 0.3% respectively.


sp'60min

Summary

Just a quiet day in market land, there really isn't much to note.

Will tomorrow see a peak in the sp'1715/25 zone? Certainly, with a QE of $5bn, it looks very viable.
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3pm update - quiet closing hour

The main indexes are still holding slight declines, although the markets second leader - Rus'2000, has been marginally positive all day. Precious metals remain a touch weak, and Oil has now also slipped to the downside.


sp'60min

Summary

Regardless of the closing levels, I have to expect upside across much..if not all of Tuesday.
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If sp'1720s tomorrow I will be sorely tempted to launch a short of this market, but really..there is no hurry.

Lets see how we close the day..and indeed.. how tomorrow morning proceeds.
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2pm update - hourly charts offering upside

Whilst the main indexes are holding moderate declines, the hourly index charts should be floored soon. Tuesday is all set up for at least 'brief' significant upside, into the target zone of sp'1715/25. Precious metals remain weak, with Oil largely flat.


sp'60min

Summary

The MACD (blue bar histogram) hourly cycle is already low,  and should be showing a turn/levelling phase by the end of today.

Even if we melt lower into the close, I sure won't be enticed to get involved.

Way too much risk ahead of what is a very sig' Tuesday QE of $5bn.
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Just a bit more patience...I think.

*AAPL within $2/3 of testing the declining 200 day MA.

1pm update - grey and rainy Monday

The market remains subdued with nothing to motivate it, at least until the next major QE tomorrow. The main indexes are still unquestionably on the bullish side, but are increasingly tired. VIX is higher, but still in the bizarrely low 12s. Precious metals remain weak, Gold -$7


sp'60min

Summary

Bears could push the market lower to test the sp'1700 level, but there still seems a near complete lack of power on the downside.

Whilst stocks like AAPL and FB continue to rise, there is clearly no sign of 'trouble' yet.

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VIX update from Mr P.



As some recognise, for those who are able to short the actual stock (certainly NOT put options, although I guess you could write naked calls), VXX is the gift that keeps on giving across the longer term.

Of course, the same can be said for the even more decaying...TVIX and UVXY.

12pm update - me want puts, but me wait

Another somewhat tiresome day of low volume nothing in the US equity market. The sp'1720s look very viable, although the two leaders - Trans/R2K, are looking real tired on the daily charts. All things considered, not too long to wait now.


sp'60min3

Trans, daily

Summary

From an hourly chart count perspective, its still highly arguable that this is a fifth little wave. The only issue is how much longer?

I've be surprised if it last into next week, but it sure wouldn't be the first time the bears under-estimated an up wave.

I will merely hold to the original outlook, seeking an index short...in the sp'1720s..which looks viable tomorrow...not least due to the next QE of $5bn.
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Time for lunch....

*here is something rather apt.



yours...still waiting.

11am update - indexes want to turn green

We're only 90 minutes into the trading day, and already the opening declines have been almost entirely negated. The market looks set for minor gains into the late afternoon, with a more substancial wave higher tomorrow. VIX similarly looks set to turn red.


sp'daily5

Summary

For those getting overly excited about the opening declines, today is indeed already starting to get annoying.

Zero reason why we won't close moderately higher, and the sp'1720s look very viable tomorrow.

The only issue is whether that will conclude the nonnsense since the 1560 low of June'24. A great many things would suggest..yes.
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Interestingly, the R2K looks VERY close to maxing out..another 1% will be tricky to attain, even if the headline indexes (Dow, SP) are 1% higher tomorrow.

The R2K short target would be 1065/75...down to 950/925 by mid September.

10am update - same old issue

The equity indexes are moderately lower, but as ever, there is absolutely no reason why such declines will be sustained. Low volume algo-bot melt looks likely into the late afternoon, with significant probability of upside across Tuesday. Near term target remains sp'1715/25.


sp'60min

Summary

Quiet start to the day, and I am indeed wondering if August is to be written off for the bears too ?

The micro-wave count would suggest we max out tomorrow, but what is going to motivate the market significantly lower this month? Will it simply be exhaustion from the sp'1560 low?


Weekly charts are again a touch weak, with a blue candle to start the week...

The thing is, in most previous cycles, we'll have 4-6 blue candles of 'chop' before an actual break down. So, it might be a frustrating August.

As ever...one day at a time.

*I am content to sit back until late Tuesday morning, and see where we are then.

Pre-Market Brief

Good morning. Futures are a touch lighter, sp -3pts, we're set to open at 1706. Precious metals and Oil are both moderately lower, with Gold -$2, and Oil -0.8%. Market looks set to consolidate for a little, before another lurch higher on Tuesday.


sp'60min

Summary

Well, this was always a key target week for a cyclical turn. Now, it may only be the start of a small multi-week down wave of 6-9%, but still, that would be something for the bears to get involved with.

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As for today, I'm certainly not expecting any significant declines today. We might even close a little higher again.

What does matter though, Tuesday sees a a major QE of $5bn.

I will be waiting for that to be done before I'll considering shorting the indexes.
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Eyes on AAPL, it will be testing the 200 day MA this week, and a failure would sync up well with the main indexes similarly maxing out.

As ever..more across the day!