Tuesday 25 February 2014

VIX moderately lower

Whilst the indexes closed somewhat mixed, the VIX failed to hold the opening gains of 4%, settling -3.4% @ 13.75. Near term outlook is for the VIX to remain in a tight 15/12 zone. The key 20 threshold is probably out of range for at least another month or so.




*The VIX got smacked lower in the brief 15min of AH trading. It tends to happen on a Friday more than any other day.

Little to add. VIX is merely trundling around in a rather tight range, whilst equities continue to generally climb.

more later..on the indexes

Closing Brief

US equities saw a generally choppy day, with the sp -2pts @ 1845. The two leaders - Trans/R2K, settled -0.7% and u/c respectively. Near term outlook is for continued broad upside into end month..and probably across most of March.



Another somewhat weak closing hour. I realise some will be getting a little more concerned that we are going to retrace (i see the 1820s mentioned in a fair few places)..but really..price action remains broadly bullish.

I simply don't see any downside power right now. Bears have to battle hard just to keep the market from melting slowly higher.

The broader up wave from the sp'1737 low continues. The VIX (although not always a great indicator), is still low, and is showing no sign of any moderate spike into the 15s, never mind the 20s.

*VIX gets knocked lower in the brief 15mins of AH trading, to settle at low of the day. It doesn't bode well for equity bears tomorrow.

The usual bits and pieces across the evening...

3pm update - upside pressure into the close

The smaller 5/15min index cycles are offering moderate upside pressure into the close, and indeed, a historic close in the sp'1850s is most certainly still viable. Metals are somewhat mixed, with Gold +$5, whilst Silver is -0.3%  VIX is back to flat in the low 14s.



No doubt many will be calling today another sign of a top, however the weekly charts would argue against it, never mind the fact we're still net higher on the week right now.

Equity bulls should merely seek a daily close in the 1850s, which is within easy range, considering we still have an hour left.

Notable movers...

Macys (M) +6%, and many of the other retail stocks are doing okay, even JCP & SHLD
Home Depot (HD) +3.8% on what were good earnings.

Again, its kinda interesting that a few of the old school retailers actually did pretty reasonable in Q4. Maybe they are just firing/not hiring to keep down the running costs though?

updates into the close...if I can stay awake...;0

3.15pm... sp'1843...a mere 3pts above the early low.

Here is the issue though..price action simply doesn't support the bears. Barring some kind of random news that spooks the market, we'll see another new up wave, one that will take us into the 1860s.

I just don't see anything for the bears to get interested in right now.

3.23pm...market battling...1843....I still highly suspicious of this price action... nothing has changed.

I guess if Mr Market wants to keep everyone guessing, it'll be a flat close at 1847

3.33pm...5/15min cycles...turning......bears beware!

3.40pm... we have a clear turn..and there is very sig' upside viable across tomorrow, as supported on the bigger hourly/daily charts. Daily charts would allow the 1870s this week.

3.46pm...chop chop...not exactly exciting, is it?

Regardless of the exact close..we're another day closer to spring..and probably the big correction that so many are waiting for.

Notable that TSLA is going to close with the bulk of the gains, +13%.  I can't imagine any retail amateur not already having covered a short position by now...surely?

3.54pm..chop chop...bulls should at least hold the 1840 level.     back at the close!

Despite the index declines..VIX barely positive. +0.5%

2pm update - minor chop continues

US indexes continue to see minor chop, with the sp'500 stalking the 1850 threshold. Hourly cycles are highly suggestive of another up wave into the 1860s, across Wed/Thursday. Metals are holding moderate gains, Gold +$4, whilst the VIX is in melt mode, -1.0%




*VIX daily looks set to churn slowly lower into the next FOMC. What will be interesting in late March/early April is how high will the next VIX spike be? Anything >22 would bode for 30s in a subsequent wave.

So..the index chop continues. Not exactly exciting stuff, but hey...another day closer to what I still believe a likely key multi-month turn.


1pm update - awaiting another push higher

US equities are seeing some lunch time chop, however, the smaller 15/60min cycles are all suggestive of upside across the afternoon. A daily close in the sp'1850s is still sought. Metals are slowly building gains..Gold +$5. VIX is a little lower, -0.5%.



Underlying MACD (blue bar histogram) cycle has not yet confirmed a turn back to the upside, but clearly, we're already negative cycle - the bears have had their retracement, a somewhat laughable -0.3%

Notable weakness, UGAZ

We're seeing some moderate follow through to the downside after yesterdays severe reversal. Nothing bullish here..and we're another day closer to spring. Seasonally, the Nat' gas bulls are now starting to fight the green shoots of spring!

12pm update - continuing on track

The early morning decline in the indexes has been fully reversed, and the equity bulls look set for a record daily close in the sp'1855/65 zone. Metals have similarly turned, with Gold +$4. VIX has naturally flipped red, and looks set for a daily close in the 13s.



*a lot of particularly dynamic moves in a fair few stocks..it is hard to decide which to highlight!

The style of price action is everything.and it remains unchanged. Broadly to the upside..and what retracements there are...are tiny..and oh so brief.

That doesn't look likely to change until the next FOMC of March'19.

Notable mover: TSLA

Pure hysteria driven, shorts getting utterly nuked.

VIX update from Mr T.

time for tea :)

12.00pm... a nano pull back to 1847...call it a nano' 2/B wave..or whatever you like, the near term floor remains 1840.

12.30pm.. market holding 1847...we'll surely be back in the 1850s this afternoon.

Lots of interesting action going on, I've not even mentioned Macys (M), which posted good results..not least with the increased margins...very odd for retail.

11am update - price action remains bullish

The market has seen a touch of weakness in early morning, but the price action remains broadly bullish, with a new short term floor of sp'1840. A daily close in the 1850s remains the target. Metals have turned marginally higher, Gold +$1



I've adjusted the upward channel a bit (I'm really not too particular about changing it when necessary)..broader trend is clearly STILL to the upside.

Notable mover...

UAL, daily

The airlines continue to...fly. UAL especially looks strong for a few more weeks. The low $50s look a pretty easy target before the main market rolls over.

11.21am.. and...we're back in the 1850s again..which should again confirm to most that  yesterdays break to 1858 was not a brief affair.

Hourly charts offer a daily 'best bull case' close in the 1860/65 zone. No doubt..the QE today is helping.

10am update - mixed opening chop

The US market opens with some mixed chop. The smaller 15/60min cycles are offering sig' upside later today, and with QE, equity bears face major problems. A daily close >sp'1850 is expected. Metals are a touch weak, Gold -$4.



*note the VIX, barely higher....will probably turn red given a few hours.

So..minor chop to start the day, and once again..any equity bear should surely agree that the price action is simply not showing any real downside power.

At best..bears get a few hours of weak chop..before the market begins another up wave.

TLSA, daily

What can be said, other than...the hysteria...continues.

9.57am.. market trying to floor at 1840... the smaller 5/15min cycles are about done.

Bears...here comes the QE money!

TSLA +13%....absolutely mayhem for the TSLA shorts this morning. According to clown Cramer, its due to some research report.

Maybe its time I published my own report....in particular on AMZN ?

10.02am.. econ-data comes in weak...but the index cycles look floored at sp'1840.

Metals turn positive....whilst UGAZ -6%...Nat Gas is probably -1.5 to -2% or so.

10.08am.. market trying to put in a spike floor at 1840. Certainly..price action does NOT favour the bears.

QE is coming..$2-3bn of 'Yellen bux'.

10.11am... provisional turn ...confirmed.

10.17am..so.. we have an initial floor at 1840...nothing conclusive yet...but we'll know within a few hours.

Typical turn time of course is around 11am, so rest of this hour could be chop.

Regardless..as we move into the afternoon, I'd be surprised if we aren't comfortably in the 1850s. 

notable strength: UAL, +3%... more on that one later.

10.25am... bounced already 7pts to 1847....bears on the run!

Pre-Market Brief

Good morning. Futures are a touch lower, sp -2pts, we're set to open at 1845. Precious metals are weak, Gold -$3, although still in a broadly bullish up trend in the near term. With another sig' QE-pomo today, equity bears face the usual problem.



*awaiting housing data at 9am, and another pair of data points at 10am

So...another day, and it looks like we'll open with some minor mixed chop. Considering the QE, I'd guess we do achieve a daily close >sp'1850 today.

There is simply no downside pressure right now...and weekly charts are most certainly offering much higher levels in March.

early mover: TSLA, +7% @ $233 (I've no idea why..yet)

HD +2.6%, on better than expected earnings.

UGAZ..starting to slide again..-4.5%

Video update from Mr C.

stay tuned

8.56am  Futures turning positive, ahead of the housing data.

9.37am.. mixed open chop....hourly MACD cycle arguably flooring no later than 11am.

With QE today, bears getting opportunity to exit (although who exactly was shorting at 1858 anyway?).

9.45am.. seen this type of price action a thousand times..and it rarely works out for the bears. 

Momo stocks all looking crazy strong..not least the TSLA.

Another day for the bulls

The sp'500 has followed the Nasdaq with a decisive break above the January 1850 high. The equity bull maniacs remain in full control, but as we move into the spring, the market becomes increasing susceptible to putting in a key multi-month high.




Suffice to say, I'm holding to the broader weekly'8 outlook. Best guess remains, just another 3 weeks or so to go.

We have the third green candle on the weekly 'rainbow' (Elder Impulse) index chart. Also key to note, the lower weekly bollinger, with a new week underway, has jumped into the 1740s.

I think it is very important to keep in mind that by end March, the lower weekly bol' will likely be around 1800. It will be real difficult to break much below there in early April.

Looking ahead

We have some housing data, consumer confidence, and the Richmond Fed manu' index.

*there is sig' QE of $2-3bn...bears beware!

The wave continues

Just reflect on this... 1737 to 1858, a climb of 121pts (6.9%), across 13 trading days. I watched one video this morning, an infamous 'doomer' was calling this a B wave bounce. He was citing just the Dow index of course, not the Nasdaq, which continues to lead the way. Additionally, there was no mention of the two leaders, which both look set to break new historic highs.

i realise many are still calling this just another 'bounce', but really, today's break above 1850 was yet another decisive break into new territory for the bulls. Yes, the late afternoon was a little weak, but we still closed up 0.5% across most indexes. Not exactly a down day, was it?

We have two more sig' QE-pomo this week, and so long as the Yellen doesn't say anything 'stupid' this Thursday - when she faces the US senate, the bulls have little to worry about into months end.

Goodnight from London

Daily Index Cycle update

The US indexes closed with moderate gains, sp +11pts @ 1847. The two leaders - Trans/R2K, settled higher by 0.4% and 0.9% respectively. Near term outlook is bullish, and with continued significant QE-pomo, the equity bears face the usual problems.





So, we have the sp'500 now following the Nasdaq in breaking new post 2009 highs, to a new intraday high of 1858. The Trans/R2K...and the Dow all look set to follow in the days ahead.

I suppose you could call today's daily closing candles somewhat bearish, but hey, we did break new historic highs, and despite some weakness in the closing hour, we still closed with net daily gains.

With the VIX in the low teens, this market remains a fearless one.

Closing update from Riley

a little more later...