Thursday, 31 July 2014

Pre-Market Brief

Good morning. Futures are somewhat lower, sp -11pts, we're set to open at 1959 - a clear break of yesterdays low. Any close <1960 would be a net monthly decline, and also break the rather important weekly 10MA.




*awaiting jobless data (8.30am) and Chicago PMI (9.45am)

So... it looks like we'll open under yesterdays low of 1962. Whats the reason? Hard to say, but looking at the BBC news site, Israel seems intent on continuing to bomb Gaza, and maybe we're back to a market being spooked by sporadic geo-pol stories.

Next key support zone is 1952/50... the low from July 10th, and also where the 50dma is lurking.

The smaller equity cycles are already pretty low, I would merely see the open as another opportunity for equity bears to exit.

Indeed, in the opening 30-90 minutes, equity bears need to keep a watch out for a black-fail candle (VIX), and hollow red reversals (indexes).

What about the VIX?

The 14.50/15.00 zone looks a given early this morning, a move into the 16s would surprise me, and be suggestive of 'something new going on'.

** I didn't sleep much last night for a number of reasons, I will endeavour to be here across the day, best I can.

Good wishes for Thursday trading.

9.32am.. well, we're off and running.. and I'm surprisingly awake again.

VIX 14.50s.... eyes on the VIX for a reversal in the opening 30mins.

PMI number at 9.45am... that is kinda important...

Notable weakness, WFM, -6% in the $36s on lousy earnings.

9.38am... VIX candle turns BLACK

Equity bears should be VERY careful here.... if this black candle holds until 10am.

9.40am.. Interesting that the July 10'th low still holding....

VERY high risk of a reversal here.. hourly cycles were floored yesterday afternoon... and on a pure cyclical basis, we're due to go UP.

9.45am.. black VIX candle... flips back.... equities resume lower.  Oh well, next natural opportunity for a floor is around 11am.

9.48am.. PMI... 52.6.. .. ugly number... borderline recessionary

9.53am... VIX candle.... BLACK... again, how it closes this opening 30mins.. pretty important.