Friday 20 September 2013

Volatility fails to climb

Despite the main indexes all closing lower, the VIX remained very subdued, and settled -0.3% @ 13.12, - with an intra-day low of 12.52, and a peak of 13.47. Across the week, the VIX declined 7.3%. Near term trend looks bullish for equities, and VIX looks set to remain low for some weeks.





This remains an almost entirely fearless market. Once again we have a VIX that was very weak into the weekend. This was despite persistent equity weakness, with the Dow -185pts.

If sp' can battle into the 1730s next week (which is my target), then VIX will be in the low 12s..if not the 11s.

Anyone with targets of sp'1800/1900s late 2013/early 2014, should ask themselves the question, where will VIX be then? Are we going to see single digit VIX before the current grand cycle is complete ? Considering the QE, and the continued mainstream delusion, I have to think there is a very high chance.
more later..on the indexes

Closing Brief

The main indexes all closed somewhat lower, with the sp -12pts @ 1709. Precious metals closed sharply lower, with Gold -$37. Despite the equity declines, VIX closed barely 1% higher. The broad weekly trends remain to the upside though, and sp'1730s are the target for next week.



Some HUGE volume at the close of this quad-opex, where the Dow/SP are being rebalanced.

*I am long from sp'1713, will hold long across the weekend, seeking an exit in the 1730s late next week.

Its been a tough week...I'm glad its complete.

Have a good weekend.

*next main posting, late Saturday - US weekly indexes

3pm update - bears at risk of closing hour ramp

The market remains lower by around 0.5% or so, with the two leaders - Trans/R2K, -0.2% and flat..respectively. All things considered, the broad weekly trend remains bullish, and is highly suggestive of a move into the sp'1730s next week. VIX is fractionally higher, but vulnerable to closing red.




*I am long from sp'1713..will hold across the weekend.

Moderate risk of a little ramp into the close. The smaller cycles are all arguably floored, and what few bears are out there, might do well to close out ahead of next week (when there are no less than 3 big QE-pomo days).

Regardless of the closing hour...I'm reasonably content with my entry in the 1713s, and I think there is a good 15/20pts upside opportunity next week.

updates into the necessary.
- real danger now..if that floor is busted...

The huge jump on almost entirely negated

3.09pm... Big rebalancing at the close, Dow'30...kicks out AA, BAC, and HPQ... in GS, NKE, V.

Bullish, yes?

3.32pm..well, 1709... vix 13.43...hmm.... weak bulls are getting shaken out now...

Regardless, I'm not concerned. It can be difficult to pin a floor, looks like I'm at least 4pts out.

3.38pm.. BBRY ...urghhh

Now that is one way to end the week.

3.47pm.. sp'1711.. and despite posting new lows... VIX did NOT break a new high.

Look for some huge volume at the close of this witchy x4 opex.....

Look to the east...the big moon rises again! Thats bullish....yes?

2pm update - it remains...just minor weakness

The main indexes continue to slip lower, but the declines are very slight, and there remains a complete lack of power on the bearish side, not least with a VIX that can barely claw back to evens - despite a dow -110pts. Precious metals remain sharply lower, Gold -$31, Silver -$1.10.



*I remain on standby to launch an index-long position, the 1712/10 level is pretty attractive, with target upside to the mid 1730s by end of next week.

So..we're lower, but I sure don't sense any real power on the downside. For those who can stomach it, we're arguably in the zone to going long again.

I should add..

VIX hourly is offering a further equity snap lower..into the close

Certainly..the next hour will be kinda interesting resistance for VIX . 13.50s. I would be surprised if we go much above that.

2.11pm...standing by to go long.. eyes on the 5min cycles to pin a turn.

2.19pm   vIX 13.36..still not leveling out yet.

The hourly charts are offering sp'1708/06. Anyway, we're coming up to the magical time of 2.30pm, often a typical turn time.

2.26pm.. LONG the indexes, from sp'1713...seeking an exit, next week in the mid 1730s.

Well, I've made my move..I hold long across the weekend.

5/15 min cycles both look floored. Nothing confirmed on the hourly, but I'm content with 1713.

So..once again...permabear...long, never feels easy to trade the long side.

1pm update - indexes floored?

The smaller 5/15min index cycles look floored, with the VIX looking maxed out having managed to flip fractionally positive. For the bears...this could good as it gets today. Precious metals remain under severe pressure, with Gold -$32, and Silver -$1.10 (-5%).



*well, considering its the weekend, and I try not to hold positions across the weekend (rarely good in options trading), I'm inclined to just wait some more.

I'd like a few hours of chop to form a secure floor before getting involved. Of course, by late afternoon, we could easily be in the 1720s again.

GLD, daily

Rough end to the week for the gold bugs. Maybe problems in Oct/Nov, if GLD loses 125

1.28pm.. fractionally lower lows...and sp'1712/10 looks viable within 30/45mins.

Hmm...VIX remains...flat. despite the declines.

12pm update - just a minor down cycle

The main indexes are seeing a little expected. Market should be able to find support around the 1710 level. Bears still remain powerless, not least reflected in a VIX that earlier broke lower to 12.52. Precious metals remain significantly lower, Gold -$25



*yours truly remains..carefully watching. There is no hurry to go long, but even more so..I'd absolutely not be chasing this lower on the short side.

Well, the bulls have had a very strong week, even a brief foray to sp'1710 will do no damage to the bullish weekly trend.

VIX update from Mr T.

time for lunch

Ohh, and for the bears out there...Armstrong has something to say on the Dow

12.30pm.. well, we're in the zone I was looking for last night.

No sign of a floor yet, i'll give it until 2pm I think..

11am update - fearless market

Whilst the main indexes continue to see minor chop - to be expected on quad-opex, the VIX is once again reflecting a market is almost fearless, with VIX -3.9% in the 12s. Precious metals are getting the hammer again, Gold -$30. Oil weak, -0.4%.



Today could easily close where we are...and if thats the case, I'll be more than content to sit it out across the weekend.

I'd really want to go long, no higher than 1715/10.  Certainly, the 1720s aren't attractive enough.

Notable moves, AMZN, +2.5%.

Clearly, its because I just had a delivery in this mornings mail.

*I've never traded AMZN. I steer well clear of the hysteria stocks, but I certainly follow them!

11.26am... sp'1718....hmm..the pressure remains lower across today.

Will be interesting to see how market copes..if 1712/10. I'd have to guess it'll hold. 

10am update - opening rally failing

The main indexes open moderately higher, but price action looks set to be weak for at least a few hours. First downside target zone remains sp'1715/10. With broader weekly charts outright bullish, any close >1705 should be acceptable to the bull maniacs.




*daily 10MA will be offering strong support around 1705/10 next Monday. I simply can't imagine this market back <1700 for some weeks..if not months.

So..lets see if we get a little further weakness across the morning, and if things can stabilise in the 1715/10 zone.

*I remain entirely on the sidelines, would seriously consider going long in the low 1710s.


ohh.. and look at that VIX... indexes red...

A fearless market indeed!

Pre-Market Brief

Good morning. Futures are a touch lower, sp -1pt, we're set to open at 1721. Precious metals are significantly lower, with Gold -$15. Oil is moderately lower, -0.2%. Bulls can easily sustain any opex chop, down to around sp'1710. Weekly charts will remain outright bullish.



So, we're set to open a touch lower, and I think there is a fair chance by late morning we'll be somewhere in the sp'1715/10 zone.

At that level, I'll seriously consider going long the indexes, with an exit target of the 1730s next week.

Today is quad-opex, so price action could be a bit choppy.

Notable movers in early market: AAPL +$7 @ $479.,  GDX -1.8%.

It would seem Oscar agrees with my view, at least for today

Stay tuned!

9.17am.. so much for a slightly lower open,  sp +3pts, we're now set to open at 1725.

Regardless,  I won't chase the open. Lets see how we trade across the morning. 

9.37am...looks like a sell the open situation.

The sp'1715/10 zone looks very viable later today.

Weekly charts remain powerfully bullish

The market saw a rather subdued day after the drama of FOMC Wednesday. Broader mid-term trend remains bullish - especially into early October. If the market does not get significantly upset (not least by debt ceiling arguments), the sp'2000s look very viable for next spring.


sp'weekly4 - hyper-bullish outlook


It is actually kinda amusing to see how few people are talking about a 'straight up ramp' into Christmas and indeed..all the way into next spring. Just reflect upon how twitchy everyone was - not least the cheerleaders on clown finance TV, a mere 3 months ago - when the sp' was flooring at 1560. We're now 162pts above that level..that is a very impressive 10%.

I just can't quite fathom why the mainstream is not more confident of a continued rally. After all, the Fed have just made it clear once again, the printing continues at $85bn a month, and that should be enough to nullify any 'selling into the continued rally'.  Coming from me, I realise its ironic, but the sp'2000s look very viable by next spring.

Strong monthly gains for the 'old leader'

The transports is +7.6% so far this month, and there are still seven trading days left of the month!

Trans, monthly3 - hyper-bullish count

The above scenario is just an idea I am keeping in mind. Effectively, it is part of the 'hyper bullish' outlook, and assumes no market scares until at least the end of next spring. With the break into the 6700s, I think the 7000s are now a given. The only issue is whether 8000s are viable before the next major multi-month drop.

Looking ahead

There is no econ-data tomorrow. Neither is there any significant QE.

*It is however, Quad-witching/opex, so price action could be rather choppy.

I remain on the sidelines, but will consider an index-long tomorrow in the sp'1714/12 zone, if the price action looks okay.  With the weekly charts as they are, I think its plain crazy for anyone to be shorting the market right now.

Goodnight from London

Daily Index Cycle update

The market closed a touch weak, with the sp -3pts @ 1722. The two leaders - Trans/R2K, closed +0.3% and -0.2% respectively. Near term trend looks bullish, although there is an opportunity for a brief decline to 1715/10, tomorrow/Monday, before renewed upside into the 1750/75 zone.





I see many are now saying 'ahh, you follow through after the FOMC gains'. That seems to be the best the bears can come out with right now, its kinda lame..dare I say.

The daily/weekly charts are pushing stronger higher, and the sp'1750/75 zone looks set to be hit in October. I simply can't envision any kind of significant pull back for at least 3-4 weeks.

Yes, there is the debt ceiling issue, but I can't see that as a serious issue to be concerned about yet. Besides, King Obama has already decreed that he will just issue an exec-order anyway to raise it.

With QE continuing in full....there looks to be virtually no threat of downside until late spring 2014.

a little more later...