Wednesday 4 December 2013

Volatility higher for a seventh day

With the main indexes recovering into the close, the VIX settled +1% @ 14.70, having peaked at 15.71. This was the seventh consecutive daily VIX gain, and this has not happened since at least 2003. Near term outlook is for the VIX daily cycle to rollover within the next few days.




Indeed, more than anything, it is highly notable that today was the seventh consecutive daily gain for the VIX. We've not seen this long a run in many years.

*I have looked back all the way to 2003 (as far as stockcharts offer daily candle data), and I can NOT find a consecutive upward run in the VIX of 7 days.

This is pretty I the only one to notice?

more later..on the indexes

Closing Brief

The main indexes saw some interesting weakness, but clawed higher in the closing hour, with the sp' settling -2pts @ 1792. The two leaders - Trans/R2K, closed -0.4% and -0.2% respectively. Near term outlook is choppy, but with broader upside into end year/early 2014.



A pretty interesting day to watch. Bears saw a new low of 1779, and bulls at least are still comfortably holding the 1770s.

Right now, the notion of anything <1770 still looks unlikely.

Broader trend remains very much to the upside, and the bigger monthly charts offer dow 16500, with sp'1840s.

more later..on the VIX

3pm update - recovery into the close

The earlier floor of sp'1779 is looking reasonably secure, and with the Fed book out of the way, the bulls have another opportunity to attempt to close marginally higher. The metals are holding the gains, whilst Oil is +0.9%. VIX looks to have maxed out at 15.67




The micro count is always a bit of a nightmare to remotely guess.

Regardless of the smaller waves..the  bigger outlook remains to the upside..all the way into spring 2014.

VIX sure looks done for...but equity bulls need a break of that up trend tomorrow/Friday to have confidence of new highs next week.

3.17pm.. equity bulls should seek a close above the  hourly 10MA of 1792. That would open to the door to the low 1800s for Thur/Friday.

3.32pm.. market wants to close >1795.

3.39pm.. sp'1795...battling higher...bears on the run!

3.44pm.. VIX turns red..and bulls are looking in control for tomorrow at least..possibly into the weekend.

3.54pm.. a bit of chop..but the underlying upside pressure is there.        back at the close.

2pm update - last Fed book of the year

The Fed beige book is due at 2pm, where Mr Market is going to adjust to expectations for Q4 earnings and Q1 econ-growth/inflation. Indexes are weak..but remain very prone to a spike higher. Metals are holding very strong gains..with Gold +$27 and Silver +3.9%.


SLV'daily3 - H/S


The count on the hourly cycle...urghh..I don't know.

Does anyone want to count it as 5 down to 1779 ?

Regardless baring a daily close <1770...I still can't take these declines seriously.
- trying to confirm a possible spike-floor at 1779. Bulls need a daily close in the low 1800s, but that doesn't look viable until Thur/Friday..if at all this week.

Notable mover: FB +3%

VIX is looking maxed out..with a spiky top.

Still...bears have achieved two days in a the 15s, thats pretty good.

2.32pm.. a very vain attempt at counting this nonsense.

An ABC..much like sub'2 in early November, yes?

1pm update - metals ramping hard

Whilst equities are fighting to claw back to evens again, the big action is in the precious metals. Gold and Silver are significantly higher, with Gold +$23, and Silver +3.3%. Broader trend remains to the downside though.

SLV, 60min

GLD, daily


*Having exited SLV in the 18.70s..just a few days is increasingly tempting to launch a re-short, but not today.

Fed beige book in an hour..that is sure to give the market a kick....probably to the upside - as suggested by the bigger hourly/daily cycles.

Baring a break back >20...SLV remains very bearish

Primary H/S target remains 17.00

1.27pm..another micro wave support zone is 1779/77.

Sure is choppy out there today....whilst the metals continue to build very strong gains.

1.39pm.. getting a bounce off the 200 MA on the 1779.

Tricky day..and this hour showing the first bit of power on the downside in some weeks.

12pm update - battling it out

The market is seeing another minor skirmish between bulls and bears. How we close today is very likely dependent on the markets reaction to the final Fed beige book of the year. Metals are holding their bounce-gains, with Gold +$5 and Silver +1%.



Best guess remains...for some kind of ABC x ABC.. as a sub'4...with another ramp next the 1820/30s.
As ever, with underlying upside pressure - via QE, there seems zero point in attempting to trade the short side, even for 15/25pt moves.

VIX update from Mr T.

time for lunch!

12.24pm.. Metals getting a kick higher...

SLV, 60min

The low 19s look viable..before the next big drop.

12.31pm..ohh lookie..the CNBC effect...

BTU, 1min

A mere mention on clown finance TV, and the stock jumps. Who said TV stock pumping is dead?

11am update - recovery underway

The main indexes are already back to green, despite marginally breaking under the Tuesday lows. Even the precious metals are seeing a bounce, with Gold +$6. Oil is building gains, +0.9%. If the market likes the Fed beige book this afternoon, equity bears are going to be real annoyed.



So...we already have positive indexes, and no doubt those seeking the 1770s are getting annoyed. It really is just the same old problems. Underlying upside pressure, no doubt helped by another sig' QE this morning of 3-4bn

notable mover...

TWTR, daily

It is still early days for this new momo stock, but clearly, TWTR is so far managing to generally hold the low 40s. A break >50..that is another matter entirely.

11.37am.. touch of weakness..but the morning low should hold.

I realise some are looking for some sort of ABC... I'm calling for an X' to 1805/10..with another bit of chop.

Regardless, I see it all as just that...chop. No point in the short side..not on these type of minor moves.

10am update - opening drop, rally to come?

The indexes open a little lower - breaking yesterdays low, but overall, we're set to rally as the day progresses. Metals are bouncing, Gold +$6, Silver +1%. Oil is battling towards the big $100, +0.6%. With sig' QE today, bears face the usual problems.




Today should be pretty busy, especially with the Fed beige book this afternoon. Mr Market is going to be more than enough things to deal with today...

I'm certainly looking for a recovery across the day, and a positive daily close.

Notable movers:  TWTR +3%, TSLA -2.5%, GDX +1.8%

*metals/miners are generally weak though, and this latest bounce is likely just that..a bounce!

10.03am.. home data comes in rallying...naturally. ISM non-manu' though..missed.

QE money will be kicking in as the day progresses..lets see if the bull maniacs can claw into the sp'1800s by early afternoon.

10.21am.. bears facing real problems now.

Bearish engulfing candle on the VIX daily..confirming yesterdays black-fail...

Could be a nasty day for the bears, if market likes what the Fed beige book says later

Pre-Market Brief

Good morning. Futures are slightly lower, sp -3pts, we're set to open around sp'1792. Equity bulls have downside buffer of around 1% for most indexes before any problems. Metals and miners are weak, Gold -$2, whilst Oil is trying to rally 1%.


Dow, daily


We have a lot of econ-data today this morning, along with the Fed beige book at 2pm. With sig' QE-pomo, bears face the usual problems.

Bulls have just over 100 Dow pts of downside buffer, before any real problems.

Considering the key break higher in November, I'd be pretty surprised to see the Dow 15700s again this month.

Video update from Mr Carboni


A little economic doom chatter...Hunter with Prof. K

updates...across the day!

8.32am.. ADP jobs come in at 215k..which is annoying the market..the old 'good news is bad news' phenomena. I suspected yesterday, metals are seeing a bounce, Gold is now positive, with Silver +1.4%. I could see SLV back to the low 19s..briefly..before next wave lower.

Notable early mover... TSLA, -1%, although that is after yesterdays 16% hyper-gain.

Staying focused on the bigger picture

Whilst the bulls and bears continue to battle it out in the remainder of the year, the bigger picture is what remains important. The weekly and monthly index trends remain strongly bullish, and there is easy upside to Dow 16500 and the sp'1840s.




It was not the most exciting of days, but hey, at least the bears saw some downside price action..if only moderate. Perhaps most notable were the gains in AAPL and TSLA. AAPL looks set for the 580/600 zone by year end. TSLA remains the most unstable, and tricky one to guess. Certainly, I'd be looking for at least an eventual test of the big $100 psy level.

Something I noticed just a little earlier...

'Are we going to crash' - from Red Line Scenario

I certainly like the style of wave decline, and there are some good obvious levels at which I would jump on board such a decline. In my view though, I think it pretty unlikely. FIrst, dow 15800s need to be broken, and even if that goes, there is the 50 day MA - along with lower bol' support in the 15500s.

Obviously, ANY break <15k would be decisive enough to confirm a major trend change, and everyone would need to prepare to trade much lower levels. I just think we'll more likely than not, just trundle somewhat higher for a few more months before we see any major break lower.

As ever, it is important to keep an open mind. One of these days the market is going to break lower..and the infamous dip buyers will be the ones needing a warrior helmet and titanium flak jacket.

Looking ahead

Tomorrow is actually pretty packed. We start with ADP jobs, and no doubt that will get the market fully focused on the bigger Friday jobs data. There is also home sales, ISM, and trade data. Most important of all...there is the last Fed beige book of the year.

The market should be especially focused on growth/inflation expectations for Q4..and Q1 2014. I'd especially look for metals/Oil to see some kind of major jump higher..if briefly.

*there is sig' QE of $3-4bn...bears...beware!

Permabear on the ocean drilling rig

I follow many companies, and today picked up Transocean (RIG). Yes, despite what some might think..I do actually trade on the long side. I remain a real fan of RIG, and was waiting for a retrace to the gap zone of 50/49 to start a position.

RIG, daily

I realise the upside targets are bold, but I am seeking the 60/65 zone by late spring 2014. $75/85 looks viable at some point next year. As ever, I am very curious to see how this one turns out. Hopefully, not in a giant ball of fire in the gulf of Mexico.

Goodnight from London

Daily Index Cycle update

The main indexes were moderately weak for most of the day, with the sp'500 settling -5pts @ 1795 - with an intraday floor of 1787. The two leaders - Trans/R2K closed -1.0% and -0.5% respectively. Near term outlook is for further price chop in the 1810/1780 zone.





The third consecutive daily decline for the sp'500..ohh the humanity! Yet..seriously...the bears have no right to get even moderately confident yet.

The near term outlook is for continued minor weakness, but certainly..the broader weekly/monthly trends remain to the upside. I do not expect any move <sp'1770 in the near term.

a little more later...