Monday 4 November 2013

Volatility slips into the 12s

With the main indexes closing somewhat higher, the VIX naturally remains very subdued, settling -2.6% @ 12.93. VIX looks set to remain in the low/mid teens for the remainder of the year. It would seem the earliest opportunity for VIX >20, is mid/late Jan' 2014.




There is little to add. The indexes are in algo-bot melt mode, and the VIX is effectively flat lining..and today, VIX even lost the low teens.

There is moderate threat of VIX 15/16 later this week, but with heavy QE-pomo, equity bears face the usual problems.

*Even I don't expect single digit VIX in the remainder of this year..but we might get kinda close. VIX 11s look viable if sp'1800s.

more later...on the indexes

Closing Brief

The main indexes closed higher, with the sp +6pts @ 1768. The two leaders - Trans/R2K, both closed around 1.1% higher. The headline indexes - Dow, SP', Nasdaq, remain noticeably weaker, and there remains moderate chance of a minor wave lower to the sp'1730s.



So..the market starts the week with more gains.

Especially disturbing (even to me) are the gains seen in the Trans/R2K. All those recently touting equity doom, really need to go stare at those weekly/monthly charts for a good hour or two this evening.

The two leaders look crazy bullish, and there is very little in the near term that might restrain the current gains.

*it would seem TSLA earnings not until Tuesday..AH.   Urghhh..why no one tell me?

the usual bits and pieces across the evening...

3pm update - bears struggling.. as usual

The main indexes are holding moderate gains, and with the QE fuel continuing, equity bears just lack any downside power. Hourly index charts are offering a rollover (still), with downside to the sp'1730s within the next few days. Certainly, the notion of sub'1700s any time soon..seems next to impossible.



Well, the closing hour..of what has been a very subdued day.

However, we do have earnings at the close, most notable of course...TSLA. A stock that remains wrapped in hysteria...

take your pick..$200 in AH..or $130s?

Certainly, the immediate trend is UP...but are today's buyers about to get nuked?

3.09pm .  Trans +1.1%...7123...incredible. Remember when the 7000s seemed 'crazy talk' ?

3.38pm.. VIX 13.01....a close in the 12s would be another little victory for the bull maniacs. Weekly/monthly VIX charts are offering the 11/10s in the current multi-week cycle.

TSLA, holding 7% gains. @ 173.  Looking for some wild moves in AH, once earnings are out!

3.51pm... Trans/R2K indexes.. both gains of around 1.1%...disturbingly bullish. No doubt the TZA holders are having another bad day.

2pm update - mild hysteria in TSLA

Whilst the main market battles to hold slight gains, the most notable action today is in Tesla (TSLA), which has earnings at the close. TSLA is currently +7% @ 173..where the 50 day MA is lurking. This will be one hell of a stock to monitor afterhours.

TSLA, daily


*I remain someone who avoids meddling in the 'hysteria' stocks like Tesla. I have zero patience..or tolerance for the bipolar nature of the momentum stocks.

Frankly. TSLA could be $200 in AH...or $130.

If I had to guess..I'm going with a major drop in AH, but hey...I'm sure not shorting it.

Main market looks set for some minor weakness into the close. With no sig' QE tomorrow/early Wednesday, bears have their best chance for sp'1730s this week.

1pm update - sleepy Monday

The main indexes are broadly all at least somewhat higher, not surprisingly lead by the two leaders.. Trans/R2K. A break above the recent sp'1775 seems unlikely in the immediate term, with downside to the 1735/30 zone.



It remains almost deathly quiet out there. There just isn't much of anything going on, aside from the usual underlying upward pressure..helped by the regular doses of QE fuel.

TSLA continues to build gains ahead of earnings...

Regardless of today's buyers...I'm still highly suspect about it. Very strong downside viable to 110/100.

1.30pm.. I did mean 'unlikely' not..likely..for the sp'1775 to broken.  This market is so sleepy..its hard to type...barely able to stay awake!

Earnings at the close...TSLA, DRYS...both will be interesting to watch.

12pm update - moderate weakness

There is clearly some weakness out there, although the two leaders - Trans/R2K, are +0.9% and +0.7% respectively. Despite the heavy QE today, the headline indexes (Dow, sp, Nasdaq) have a fair chance of closing at least a touch lower.


Trans, daily


A quiet start to the week, but with the transports breaking new highs (no doubt helped by lower Oil prices), you can still see the underlying upside pressure.

VIX update from Mr T.

time for lunch!

11am update - awaiting a minor rollover

The recent sp'1775 is comfortably holding, and the market is due another rollover, probably by the end of today. Primary downside target zone is 1735/30, which should equate to VIX 15s. Underlying pressure remains to the upside ever.



It is obviously pretty quiet out there. I'll cover some individual stocks later today..when I get time.

A few days 'moderately' lower seems very viable, but I sure don't see sub 1700s any time soon.

There is simply a near complete absence of bearish downside power. Hell, even VIX 15/16s will be difficult.

*earnings at the close: TSLA, DRYS..both will be very interesting to watch.

10am update - Transports powering higher

The main indexes are moderately higher. Most notable, the Transports, which is making a play for the 7100s. The 7300s are just about viable this month. Metals are holding moderate gains, whilst Oil remains weak. VIX is a touch higher..despite the index gains.




Market looks tired again. I don't expect the sp'1775 high to be taken out this week...but likely later in the month.

We should see a rollover by late today, but it will be difficult with heavy QE..and there doesn't seem much of a catalyst to knock the market lower today.

Perhaps a down wave across Tuesday/early Wednesday, which is really the only window the bears have this week when there is no QE fuel.

stay tuned!

Pre-Market Brief

Good morning. Futures are moderately higher, sp +3pts, we're set to open at 1764. Metals are higher, Gold +$4, whilst Oil is still very weak, -0.4%. This week will see heavy QE, and equity bears will struggle to knock the market more than 1.5% lower.



*look for factory orders data at 10am, that should help the market to pick a direction, especially to the downside.

I still expect broad upside to continue in the weeks and months ahead. Yet, considering the daily index charts (where price momentum is swinging back to the bears), I'd guess we will see a very slight fall to the 1730s later this week.

I do not expect sub 1700s for the remainder of this year.

Update from Mr Permabull

I certainly agree with him on Gold.

notable movers
BBRY: suspended, -18%..on news that it is abandoning sale
NFLX and TSLA both..slightly higher.

TSLA has earnings at the close (I think), and that could turn out to be an AH bloodbath if TSLA do not inspire the momentum chasers to jump back aboard the electric car. I have to think ,with the break <160, the stock is headed for 110/100 in the near term.

Have a good week everyone!