Thursday 24 April 2014

Volatility a little higher

With equities seeing opening gains quickly reverse, the VIX spiked +5% or so, and held positive for the rest of the day, settling +0.4% @ 13.32. Near term outlook is for the VIX to remain within a tight 14/12 zone until the FOMC next Wednesday.




Little to add.

VIX remains low, and whilst the bigger daily/weekly equity cycles are bullish, the VIX is sure to remain at what are historically low levels.

For me, the only issue when we are going to break into the 20s again this year...not 'if'. Right now, that doesn't seem likely until at least mid/late May, if not early June. 

more later..on the indexes

Closing Brief

US indexes saw some notable chop, opening gains failed, but a swift reversal never saw any follow through. The sp' settled +3pts @ 1878. The two leaders - Trans/R2K, settled -0.4% and -0.2% respectively. Near term outlook is bullish into next Wednesday's FOMC.



*it was a good day for yours truly. A good early exit in FCX, my secondary long of RIG is already considerably higher. The only error was seeing an SLV short reverse from the open, which I should have bailed on.

I picked up a replacement long position in the closing hour, CHK, from the 29.20s. I am seeking an initial exit in the 30/31 zone next week.

So..opening gains, a reversal, but..once again, the equity bears just lack the downside power...and the support zone of 1875/70 most certainly is an important zone.

Right now, the notion of <1850 looks completely out of range, and indeed, I'm seeking a break into the 1900s within the next few trading days.

The big unknown is how will the market cope with QE-taper'4 next Wednesday? Will it be key turn lower, some 'mixed chop', or just keep on climbing across much of May?

Regardless, I can't consider shorting the indexes until at least next Wednesday afternoon, and even then, the weekly charts strongly argue against such a trade.

more later..on the VIX

3pm update - minor upside into the close

Equities continue to see mixed weak chop. The smaller 5/15 minute index cycles are suggestive of upside into the close, rather than continued weakness. VIX is higher, but only 2% in the 13s. Metals look to set to close with moderate gains, Gold +$6



Interesting day, not least the opening reversal..which itself reversed.

I realise for many bears out there, today was just another typically annoying day. 

For me, it has been a pretty good day....the following is helping....

RIG, weekly

seeking the 44/45s tomorrow, where I will seek a provisional exit.

ps. I don't wanna hear from anyone that I never go long!

3.18pm.. I have my eyes on a new long position.

seeking an entry 29.15/10..into the close.

3.26pm.. LONG CHK from 29.20s.   Will hold overnight, and probably into next Wednesday. Seeking first target of 30/31

3.52pm.. minor chop..but overall..another day for the equity bulls - not least after the opening reversal failed to see any follow through.

I will hold LONG overnight... RIG, CHK,  and SHORT- SLV.
back at the close.

2pm update - minor afternoon weakness

Another minor down wave to the sp'1870s, but it is very likely just another tease to the equity bears. With underlying upside pressure - seen better on the daily/weekly cycles, Metals are trying to build upon early reversal gains, Gold +$6



Minor down wave...another tease to the bears.

I do NOT expect new lows into the close.

Typical turn/floor time remains 2.30pm.

RIG just keeps on climbing, +4.6% in the mid 43s.   Seeking 44/45 tomorrow...where I would exit for the weekend.

1pm update - minor chop

The bull maniacs continue to battle hard to hold the sp'1880s, and there remains a general lack of downside power. A daily close in the 1880s would be yet another bear failure. Metals are holding slight gains, Gold +$5



Little to add right now..aside that 'something is going on' in RIG, +3.4%, the 43s are coming.

Hourly MACD set to go positive late today.

12pm update - battling it out

Equity bulls are battling hard for a daily close above the opening high of sp'1884. Hourly cycles are set to go positive cycle late today/early the bulls maniacs certainly have things in their favour. Metals are holding the opening reversal gains, Gold +$5, but still..a little shaky.



*busy morning so far..its a battle just to keep up with the comments/email....but always good to hear from you...regardless of bullish..or bearish.

VIX update from Mr T.

time for ..tea.

12.22pm.. minor chop continues..but with underlying upward pressure.

Notable strength: RIG +2.5% in the mid $42s..which is very pleasing to yours truly.

11am update - no follow through

Equity bears achieved a rather powerful opening reversal, but there is a complete lack of follow through, and the market has quickly stabilised in the low sp'1870s. The VIX is similarly indicative of a market that remains lacking any real concern.



Indeed, another 'fail' for the equity bears this morning.

I wish I could believe it'll unravel later today, but no.

I am still short SLV (should have bailed at the open..oh well)

Huge opening reversal, but the gains are looking shaky. Mega volume to start the day, biggest in some months.

I remain short, will look for a break under the 2013 lows ($17.75) in the near term.

11.07am.. Anyone know whats up with UAL ? -5%

11.11am.. nasty market...floor spike..and now we're back in the 1880s.

Oh man, a daily close in the 1890s would TRULY spite the bears. Awful !

I remain SHORT SLV,  LONG RIG (kinda seeking $46/47 on that one)

11.27am.. Well, we have a clear secondary reversal..and the equity bulls are back.

 VIX set to turn red again......back at 12pm... its time for my lunch!

10am update - opening reversal

Opening gains have completely failed to hold. With black candles appearing like a virus, we have a classic opening fail for the bull maniacs. VIX is higher, but there is still unquestionably a lack of    Metals rebound from overnight lows, Gold +$6.



*I bailed on FCX (long) at the open.

Despite the opening reversal, I'm still dubious of the bears. Barring a break <1850, along with the 50 day MA @ 1857.

re: AAPL

The daily candle looks VERY vulnerable like that - same as NFLX just a few days ago.


To be clear, this is an interesting open, but I still do NOT see the equity bears as having much  hope until next Wednesday's FOMC.

I would change my view on any break <sp'1850. Until then, the broader up trend HOLDS.

time to shop...back in a bit!

10.34am.. back from the shops (yeah, I do shopping trips between my postings)

So, indexes are a touch weak, ever..bears just lack the downside power to really break lower.

A daily close in the 1880s remains very viable...which I realise is going to really annoy many.

10.41am... Precious metals are still higher...but...already starting to lose their reversal gains.

Gold appears stuck under the 200 day MA...and Silver is much weaker of course.

I'm still looking for the 2013 lows to be taken out, maybe they'll do it on a Sunday night or FOMC day.

Pre-Market Brief

Good morning. Equity futures are somewhat higher, sp +11pts, we're set to open at 1886, a mere 11pts shy of the historic 1897 high. Precious metals are sharply lower, Gold -$14, with Silver -2.0%. Equity bulls look set for a charge to the low 1900s within the next few days.



*awaiting jobless and Durable Goods Orders

So, with AAPL +8% in the $560s, the Nasdaq is leading the way for the broader market.

Mainstream consensus is likely going to swing strongly bullish today...and Mr Market has a real chance to close the week in the 1890s..which sets up the low 1900s next week.

As for me, I'm short SLV, LONG FCX, RIG..and so far...this morning is looking good.

Good wishes for Thursday trading :)

8.55am.. sp +13pts, ..1888.  Just 9pts below the key high.

Considering the hourly index cycles...the underlying momentum does offer a challenge of 1897 this afternoon.

No doubt, some will call for a double top there, but I'd just say anyone go stare at a weekly chart for 10 minutes.

9.20am.. sp +10pts... we're set to open at 1885. 

Metals recovering a fair bit of the overnight declines.. hmm

9.35am.. EXITED ... long FCX, 34.35... very happy with that one.

9.37am..  a lot of black candles all over the place.... Bulls..should be cautious!

9.40am... BLACK-fail candles...EVERYWHERE. This is kinda interesting open.


9.43am.. R2K is RED....... I've not seen so many black-candles in a very long time.

Clear reversals on just about everything...even AAPL is cooling..a bit.

9.49am.. a full opening reversal...and those black candles sure did warn of trouble!

The next big retrace

The weekly index charts continue to suggest at least a few more weeks of upside - since the recent low of sp'1814. A move into the 1925/50 zone is the target for late May/early June. From there, the equity bears will have yet another opportunity to attempt to put in a key inter'3 top.

sp'weekly9 - fib levels


The above chart is something I've posted a fair few times in the past few months. Yes, I've certainly adjusted the starting point, and right now, I'm assuming we will reach into the 1925/50 zone.

I'd be surprised if the market can break >sp'1950/2000 this side of the summer.

Looking ahead

Thursday will see the usual weekly jobs data, along with Durable Goods Orders. If either/both of those come in at least 'reasonable', the equity bulls should be able to push into the 1885/95 zone, bringing within reach, a weekly close in the 1890s - setting up the low 1900s for next week.

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

Permabear...picking up positions

I regularly chart/follow a good 75/100 companies each day (never mind the ETFs, commodities), and a few caught my eye last night. Notably, FCX and RIG. Both of the weekly charts look bullish in the near term, so I picked up a small position in both this morning.

FCX actually has earnings early tomorrow, so I'm expecting a sig' way or the other.

Further, the broader down trend continues in the metals, and I also picked up a small short position in SLV. Gold and Silver still look set to break the 2013 lows, and I'm guessing we will eventually see a multi-year floor in Gold, somewhere in the 1050/950 zone.

Goodnight from London

Daily Index Cycle update

US indexes saw minor price chop across the day, sp -4pts @ 1875. The two leaders - Trans/R2K, settled +0.1 % and -0.7% respectively. Near term outlook is for the broader upward trend to continue into next Wednesday's FOMC.



A somewhat tiresome day, and there really isn't much to note on the broader market.

Price action very much favours the equity bulls. There just seems a lack of any real downside power, and even the sp'1850s look out of range.

a little more later...