Tuesday 10 December 2013

Volatility manages a small gain

Whilst equities saw general minor weakness across the day, the VIX battled hard to hold minor gains, settling +3.1% @ 13.91. Near term outlook is for the VIX to remain within the 15-11 range. VIX looks unlikely to break into the 20s until at least late January.




*the closing black-fail candle on the daily chart should concern the equity bears, with real threat of the sp'1820s by late Thursday.

Little to add. VIX remains low..choppy...and likely to melt lower, the closer we get to what is usually a sleepy holiday trading period.

*Next weeks FOMC is after Dec' opex, and even then, I don't expect anything above the mid teens..if at all.

more later..on the indexes

Closing Brief

The main indexes closed moderately lower, with the sp -5pts @ 1802. The two leaders - Trans/R2K, settled -0.7% and -0.9% respectively. Near term trend remains bullish, with the sp'1820s likely before this week concludes. Broader upside remains the 1840s by year end.



Just another day in market land, where we opened a little lower, but as ever..the bears are pretty much powerless, and the market saw minor chop for the entire day.

The hourly charts are sporting a very clear bull flag, a break >1812 will confirm it.

Underlying MACD (blue bar histogram) cycle is close to flooring, and will likely tick higher across Wed/Thursday.

The most notable aspect of today were the momo stocks, all of which saw very impressive gains.

more later..on the VIX

3pm update - climbing into the close

The main equity indexes look set to climb into the close. There is a very reasonable chance we'll close the day net positive. Momo stocks remain very strong, and are a reminder of the underlying lunacy in US capital markets. Metals remain stuck under old broken support.



I'd guess that is a very clear bull flag on the hourly charts.

We have a MACD cycle that is probably floored, and the 15min cycle is screaming 'we're  going up'.

As based on recent price action, I'll be damn surprised if we don't rally into the close.

3.26pm... hmm, well, we're battling hard for a positive close. I wonder how many day trading bears will need to close out..which might be enough to kick the indexes green.

A gap higher at the Wed' open..very viable...but 1820s more likely Thursday..when we have another few hundred wheel barrows of benny bux.

3.47pm.. minor chop...underlying pressure remains to the upside though.

So..two days of the week gone..and bears are so far unable to break <sp'1800. It does not bode well for rest of the week, does it?   

2pm update - the permabear kiss of death?

The main indexes are continuing to see very minor chop. Certainly, there is a touch of weakness, but with the momo stocks building gains across today, equity bears should be very concerned that we might be trading in the sp'1820s by late Thursday. Metals remain stuck at old broken support.


SLV, daily2


*Considering the recent price action, I've removed the ABC count on the hourly index chart. I realise of course, that might be the kiss of death for the bulls, with the market dropping to the 1770s within hours..if not minutes.

Seriously though, bears just look weak.

Hourly MACD cycle looks close to a floor, and there is high risk of another lurch higher across Wed/Thursday - the latter of which has heavy QE.

2.29pm.. 15/60min cycles are VERY prone to snapping higher across the rest of today.

Bears...beware!  First target upside ...1808/10.

1pm update - momo stocks looking strong

Whilst the main market continues to see some minor weakness, the real action is in the momo stocks. The usual suspects...FB, TSLA, NFLX, and TWTR, are all significantly higher, and arguably indicative of a market that will rally into year end. Metals are stuck around old broken support.

TWTR, daily

NFLX, daily


It is kinda odd, but everyone seems to have forgotten about NFLX since the severe reversal on earnings. It remains within a broader up channel..and there seems little reason why it won't be in the $400s next spring..along with AMZN.

Hey, at least NFLX makes a profit.

As for the indexes, the price action sure doesn't suggest any downside power..and right now, a break below the recent 1779 low looks extremely unlikely.

1.04pm.. clown TV proclaiming 'CRISIS OVER', with liesman and a red cheer leader.

Is that a sell signal ?

1.07pm.. we have a possible - if not likely, floor on the hourly charts.

Underlying MACD (blue bar histogram) cycle is going to start ticking upward this afternoon..and be positive tomorrow. Upside for rest of the week.

12pm update - ten seconds was more than enough

The sp' is down a mere 0.25%, and frankly, its pretty lame. Equity bears still lack any downside power, and right now, the notion of a C wave lower..looks highly improbable. Momo stocks are showing significant strength, and that further suggest the general market will hold over sp'1800.


FB, daily


*all the leading momo stocks appear to be higher, and as is often the case, they should be a warning to the bears that the underlying market pressure remains pretty strong.

I have refrained from watching clown finance TV this morning...well except for ten whole seconds.

I caught the Liesman..with the caption 'taper-on'. Same old crap..just a different day. CNBC..and Bloomberg have been playing the 'taper on/off' game since late February. Even now, it bemuses me  how people seem to forget so easily?

Taper next week? I can think of a hundred reasons why not..but ohh yeah..I'm sure some bears out there will be getting overly excited about the FOMC next week.

VIX update from Mr T.

time to cook

11am update - bears look weak

The indexes have already reversed most of the opening declines, and the sp' looks set to make a challenge of the recent 1813 high. A daily close in the 1820s looks very likely Wed/Thursday. Metals are holding gains, but are clearly stuck at the old broken resistance.




*VIX is higher, but I think that is to be dismissed as spurious, not least after the closing minute smack-down yesterday.

Frankly, bears just don't look like they have any downside power. As I have noted for the past few days, with no real news due this week, market is more likely than not, to just battle upward.

For those desperately still hoping for a C wave lower..I just don't think its viable.

Notable strength in TWTR, FB, NFLX, TSLA...all the momo stocks are having a strong morning.

11.22am.. FB breaks into the $50s... TWTR is holding $51s..and NFLX =2%.

The momo stocks really are in favour this morning.

10am update - minor weakness

Good morning. Equities open slightly lower, but with the momo stocks already pushing higher, the bears just don't look strong enough to break a C wave lower - as some are still seeking. Metals are sharply higher, and testing the old broken floor, Gold +$22, Silver +2.5%.



There is actually a lot going on already, most notably in the momo stocks, where there is some significant volume (as far as I can tell).

TWTR is leading the way, +4% into the 51s. Clearly, a lot of short-stops will have been hit, and some chasers are coming in now. It remains bizarre of course..since the company makes no profit..but hey..its the new economy right?

As for the metals...

GLD, daily

The metals had better keep pushing higher for the rest of this week..or there is high probability of a simple back test of old support..before renewed weakness.

Downside targets remain GLD 110, with SLV 17

Bigger cycles offering further gains

It will be tough to break into the sp'1820s this week, but the bigger weekly/monthly index cycles are both offering the 1840s by year end. Equity bears remain almost entirely powerless, and whether QE is $85bn or $70bn by next spring, there will remain significant underlying upward pressure.

sp'weekly8 - mid term bullish outlook

sp'monthly3, rainbow


A quiet start to the week, and equity bulls should be more than content with today's price action. We have some rather clear bull flags on the hourly index charts, and with general upside pressure (as ever), there seems little reason why we won't close this week at least somewhat higher.

Looking ahead

There really isn't anything of significance due tomorrow, just wholesale trade data at 10am, but I don't think the market will give that much attention.

*next sig' QE-pomo is not until Thursday.

ABC - due to be trashed

Trying to count the micro 60/15min cycles is always difficult, and whether or not there is even a C wave lower this week is largely inconsequential. The bigger picture remains starkly bullish, and without getting lost in the nonsense taper-on/off talk, I would be very surprised if we don't break into the 1900s before the next multi-month top is formed.

A quiet day indeed, and I'll leave it at that.

Goodnight from London

Daily Index Cycle update

The main indexes closed with moderate gains, sp +3pts @ 1808. The two leaders - Trans/R2K, settled +0.3% and -0.2% respectively. Near term outlook is broadly bullish, with the bigger weekly/monthly cycles offering the sp'1840s before year end.





*it remains notable that the Nasdaq Comp' broke a new high today, although is still almost 20% below its 2000 tech bubble peak.

There isn't much to add. The broader mid/long term trend remains unquestionably bullish, the only issue is whether the bulls can claw another 1, 2, or 3% higher before the year wraps up.

Considering the ongoing QE, it'd be surprising if we don't at least briefly break into the sp'1830/50 zone, before another micro down cycle.

a little more later...