Wednesday 20 November 2013

Volatility fractionally higher

Despite the main indexes closing moderately lower, the VIX only managed to close fractionally higher, +0.1% @ 13.40. Near term outlook remains for the VIX to remain in a tight 13/11 range. VIX continues to reflect an essentially fearless market.




I think the VIX tells the story of today. Despite a little post-FOMC weakness..with the Tuesday low of sp'1784 being broken...the VIX continues to suggest the market is fearless.

Equity bears really need to be mindful of the closing black-fail daily candle. It does not bode well for tomorrow..or Friday.

Again, it remains highly implausible to believe VIX will be >20..until at least mid/late Jan'2014.

more later...on the indexes

Closing Brief

The main indexes saw some interesting price action, with some post-FOMC downside to sp'1777, and closing -6pts @ 1781. The two leaders - Trans/R2K, closed lower by -0.3% and -0.15% respectively. Near term upside is the sp'1810/20 zone.



A pretty good day to watch..and even be part of.

The indexes did break the Tuesday low - somewhat surprising, but really, the VIX indicates a fearless market, and I can't today's moderate declines seriously.

Seeking a break back into the sp'1800s before the Friday close.

*I exited an SLV-short..will look to pick that up again on any bounce..if there is one.

more later..on the VIX

3pm update - no real downside power

The main indexes are moderately lower, with the Tuesday sp'1784 low being broken. Next soft support is in the 1780/75 zone. Metals remain weak, with Gold -$28, and Silver -2.4%. The USD is +0.5%..and that is no doubt pressuring everything lower.



As ever..the fed often makes a mess of the market..and we're seeing some moderate downside.

The price action though..just doesn't look that bearish.

Baring a break under sp'1775, I can't take this afternoons little wave lower seriously.

I'm calling this decline....

a fake!

*I am content on the sidelines..having dropped almost 20 cents lower...urghhh

3.08pm  Hmm, there goes sp'1780....5pts left for the equity bulls...then it becomes a problem.

3.12pm.. VIX +2%.

Hey..equity bears...what does the VIX tell you?

*clown TV host getting overly excited about the Dow -90pts..... .what a fool!

3.19pm.. equity bulls should seek a close >1783...that'd make for a nice spike-floor.

Metals look floored..but hey..I thought that an hour ago.

3.25pm.. bears getting the first warning to 'get the hell out'.....

There can be NO EXCUSES.

Sig' ramp viable tomorrow..and into the weekend.

3.29pm.. another spike-top on the VIX hourly....bears getting another warning.

no... excuses!

3.38pm.. bulls should still aim for a close in the 1780s...pref. 1783.

VIX only +1%.... I think the VIX is telling the story.

3.43pm..spike-floor....forming....bears in dire trouble now.

3.54pm... market holding together.. vix suggesting 'nothing to worry about'.

back at the close !

2pm update - time for more fed speak

The main indexes are holding moderate gains, with the sp' at 1790. A daily close in the 1800s is very viable, as supported by the hourly cycle. Equity bears need to be mindful, even if a brief spike lower into the 1770s in this hour. Metals remain...weak.


SLV, daily'3


well...lets see how the algo-bots interpret the latest press release from the money printing maniacs.

As ever...will probably take a full hour to be clear on which direction the market wants to eventually take.

...standing by.

2.04pm... micro-spike lower...but we'll surely close much higher.

Metals..weak...look vulnerable into tomorrow.

2.08pm.. clown finance TV resorting to the same nonsense talk about Dec' QE-taper.


Metals sure are twitchy..not easy viewing. I will hold short...into Thursday.

2.14pm...hmm, the Tuesday low..being broken... interesting..kinda.

2.18pm..short-stopped out of SLV...19.28...

I'm content with that...will re-short on any bounce tomorrow.

2.21pm..indexes still look prone to a 'dumb ramp' into the close.

*I am indeed out of SLV- short...not a bad exit..I will most certainly look to pick it up again..if it is higher tomorrow morning.

One reason I was getting VERY edgy..we're approaching the typical turn time in the day of 2.30pm

2.33pm.. well, we're at that magical time of the day...often a turn.

I'm calling a floor in the least for today...

SLV, 5min.

Viable upside to 19.50/75

2.40pm.. black-FAIL candle on the VIX hourly...

equity bears...beware.

1pm update - holding moderate gains

Equities are holding moderate gains, with the hourly index cycles offering significant risk of upside into the close. Metals remain weak, and highly susceptible to an afternoon snap lower. The ECB looks set tor negative interest rates....thats bullish...yes?


Summary hour to go until the next Fed press release. From a pure chart perspective...we're likely headed zone is 1810/20s.

notable mover.. TSLA.

Target remains 110/100. A sig' bounce off the 200 day MA is very likely.

12pm update - underlying upside pressure

The indexes continue to appear to be building a sub'5 wave...with a snap higher viable this afternoon. A daily close in the sp'1800s..with Dow 16k, looks very viable. Metals remain weak, in a starkly bearish mid term trend.


GLD, daily


Not much to add.

Market appears to just be quietly awaiting the FOMC press release at 2pm. I have to guess we'll see further equity upside into the close.

VIX update from Mr T.

Time for lunch :)

11am update - chop ahead of the FOMC

The indexes are seeing some minor price chop ahead of this afternoons FOMC press release. Equity bulls should be able to hold the Tuesday sp'1784 low, and a daily close in the 1800s is viable. Metals are seeing a bounce after early declines, but the broader trend remains very weak.



So...a few more hours of minor chop..and then we'll see if Mr Market can use it as an excuse to ramp for the rest of the week. Things only get interesting if <1784..which does seem unlikely.

*as for my Silver short, I'm looking for an exit in the SLV 19.10/18.90 zone, that seems viable tomorrow..if the broader trend continues.

Notable weakness in TSLA and TWTR.

TWTR, daily

A daily close <$40...probably offers an easy $10 lower to $30 by end year..regardless of main market strength.

10am update - metals on the slide

Whilst the main indexes try to build minor gains this morning, the real action is in the precious metals market. Gold and Silver are both significantly lower, and have both taken out key support. There is very significant risk of a major snap lower - on the scale that we saw this April and June.

GLD, daily

SLV, daily'3


*I remain short Silver (via SLV)..and will be looking to dance in/out of that trade across the weeks/months ahead.

Downside targets remain GLD 105/95 and SLV 12/10. - probably sometime in 2014.

As for the rest of the market.. more later!

TSLA, looking ugly as ever...

Target remains 110/100..not far to go really. I'm still wondering about Carboni's target of $60. Oh well, lets see what sort of bounce we get off the 200 day MA.

10.32am... black candle on the VIX...and indexes trying to break higher.

Equity bears really don't look likely to break <1784.

Metals seeing a bounce off the opening low, but the bigger trend sure looks bearish. Will be interesting to see the reaction from the FOMC minutes later today. 

Pre-Market Brief

Good morning. Futures are a touch higher, sp +1pt, we're set to open around 1788. Metals are weak..Gold -$12, Silver -0.5%. Equity bears will likely find it tough to break below the 1784 low. New highs..are expected in the remainder of the week.



Today will be all about the FOMC minutes..due at 2pm.

Considering the hourly..and daily charts..I'm guessing we'll rally on whatever nonsense the Fed has to say.

Dr Copper and Oil remain very weak

Whilst equities remain within their broad upward trend, it remains notable that two of the biggest economic commodity indicators - Copper and WTIC OIl, remain very weak, with both looking set for lower levels in the near/mid term.

Copper, monthly

WTIC Oil, monthly'2


A bit of a choppy..and dull Tuesday.
Meanwhile, we do indeed have Copper and Oil still looking weak. Copper is especially something that interest me - since I'm currently short Silver (via SLV).

A break <$3 for Copper would bode badly for the precious metals, with Gold and Silver likely to take out their June lows.

As for Oil, as many realise, lower oil prices are unquestionably a good thing for the broader economy.  That would most certainly include the mining stocks..who are of course trying to cope with lower metal prices.

Looking ahead

Wednesday should be a lot more active. We have retail sales data in the morning, and Mr Market should at least be paying some attention to that. However, more importantly...we have the FOMC 2pm.

No doubt the algo-bots will be in full search/analyse mode. I think there is a very strong likelihood market will rally on whatever the press release might say.

Come back next year

Broadly speaking...I simply don't see anything 'significant' for the bears until Jan/Feb 2014 - when the debt ceiling/budget issues again arise. Yet, even that might only amount to a 4-6% drop, and that would likely begin from levels higher than where we currently are.

As I will keep saying, for most of the equity bears out there, it is largely a case of remaining on 'survival mode' until we see a clear intermediate top put in.

Goodnight from London

Daily Index Cycle update

The main indexes closed somewhat weak, with the sp -3pts @ 1787. The two leaders - Trans/R2K closed -1.0% and -0.5% respectively. Near term outlook is for renewed moderate upside, to the sp'1810/30 zone by early December.





Primary trend remains unquestionably to the upside.

Equity bears continue to get periodically teased..only for the market to resume higher. With the QE fuel likely to continue for a very considerable time to come (end 2014, according to Fed 'Evans), this situation looks unlikely to change until the late spring at the earliest.

Even then, it might take a good 2-3 months for the market to form a choppy intermediate top - as was the case in summer 2011.

I am in no mood to get involved on the short side of the indexes for another 4-6 the earliest.
a little more later...