Volatility a little higher

Despite most US equity indexes seeing moderate weakness across the day, the VIX remained very subdued, and was barely able to claw positive, settling +0.3% @ 12.17 (intraday low 12.03). Near term outlook is for the VIX to remain within the 14/11 zone.


VIX'daily3

Summary

It remains kinda bemusing how so many equity bears are getting excited in what are extremely tiny upside spikes on the VIX. Even the 15/16s currently look completely out of range.

VIX 20s do not look viable until mid June at the earliest.
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more later..on the indexes

Closing Brief

US equity indexes all closed somewhat lower, sp -8pts @ 1888. The two leaders - Trans/R2K, settled lower by -0.9% and -1.6% respectively. Near term price structure is offering a bull flag, with further moderate upside likely - as supported on the bigger weekly/monthly cycles.


sp'60min

Summary

There really isn't much to add, on what was a pretty tiresome day of micro chop. Even the late afternoon weakness was relatively minor (for most indexes), and considering the recent historic highs, this is a very natural retrace.

Sure, the R2K/Nasdaq were especially weak, but what is surprising about that?

There is an array of econ-data tomorrow morning, and we've opex on Friday..so..the remainder of the week should be increasingly dynamic.

*I hold moderately long overnight, will be seeking an exit into the Friday close.
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more later on the VIX

3pm update - minor weakness

The broader market remains a touch weak, but the trading range for most indexes exceptionally tight -  sp'1894/92 for much for the day. Metals managed to hold gains across the day, Gold +$11, with Silver +1.1%.


sp'60min

Summary

*despite the equity weakness, the VIX is only up 1%.
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I remain utterly tired of the bearish chatter across the last few days..and indeed, weeks.

Where has that sentiment got any of the bears since the sp'1814 low?
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*ohh, and yes, that is a small bull flag on the hourly chart, with the underlying MACD cycle arguably floored. 

back at the close

2pm update - churning a floor

The sp'500 is still churning a floor in the low 1890s. A daily close in the 1900s remains possible, and is certainly supported on the 15/60min cycles. Metals are holding gains, whilst the VIX is fractionally red - despite obvious weakness in equities.


sp'60min

Summary

Little to add, on what is a relatively quiet day.
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No doubt there will be some bearish chatter out there this evening, along the lines of 'see...the market didn't break another new high today...we're clearly headed lower now!'.

I'd merely refer anyone to a VIX chart.  

1pm update - a steady market

The broader market has stabilised in the low sp'1890s, with a VIX that continues to reflect a market with zero concern of the near term. Metals are cooling a little from the earlier highs, Gold +$11, with Silver +1.1%. VIX is flat in the low 12s.


sp'60min

Summary

Little to add, on what is likely to be a relatively quiet afternoon.
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Silver with a black candle at the 50 day MA, not exactly bullish!

The declining channel should probably be adjusted a little. Regardless of the minor noise..the broader trend remains bearish.

12pm update - latter day recovery

US equities look set for a moderate (if somewhat typical) latter day recovery. Even the R2K/Nasdaq could close with net daily gains. Metals are holding sig' gains, Gold +$11, with Silver +1.4%. VIX looks set to close negative, in the 11s.


R2K, 60min

Summary

VIX remains a key signal, and despite the early equity weakness, the VIX could barely hold a gain of 1%.
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R2K certainly fell further than I thought it might, and has achieved a gap fill. Another wave higher into the 1140/50s looks pretty easy to achieve, whether before opex..or after...it does not really matter.
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VIX update from Mr T.



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time for lunch

11am update - morning floor

US indexes have almost certainly seen the low of the day, and with an opening black candle on the VIX hourly cycle, equity bears should already have bailed. There remains distinct weakness in the R2K/Nasdaq, but even those look set to close today with net gains.


sp'60min

VIX'60min

Summary

*I remain long, seeking to exit in the R2K 1135/45 zone.
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A long day ahead, and really, I just don't see how anyone can be getting overly bearish, whilst the indexes are still regularly breaking new highs.
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back at 12pm

10am update - minor weakness

Equities open a little lower, but price action is not in the least bit bearish. Considering new historic index highs just yesterday, it is bemusing how anyone could possibly consider sp'1902 as a key top. Indexes look set to recover as the day proceeds. Metals are holding gains, Gold +$12.


sp'60min

Summary

*I picked up a secondary IWM call block just earlier. I can't take the opening declines seriously, and expect some degree of net daily gain.
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So.. we're lower, but not by much, and there is simply no real power on the downside.

Same old story.....and I expect higher levels by late today.
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VIX is higher..but by a mere 1%.... equity bears would do well to dwell on that aspect for this hour.
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Opening black candle on the VIX... bears beware!

Meanwhile..R2K fills the gap...

1140/50 still seems an easy target on the next wave.
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10.03am.. notable strength in the drillers, with opening reversals in DO, RIG, and SDRL, not that I will getting involved in those. 

Pre-Market Brief

Good morning. Futures are a touch lower, sp -3pts, we're set to open at 1894. Precious metals are sharply higher, Gold +$13, Silver +2.1%. Equity bulls have little to prove, having broken new index highs, but just need to hold the sp'1890s.


sp'60min

Summary

So..we're set to open a little lower, but there is little reason why we won't turn positive within the opening hour, with a daily net gain.
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Notable early strength, FCX +0.7%
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Video from Mr C.



Naturally, Oscar is sticking with his upside target, which looks to be somewhere in the sp'1910/20 zone.
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9.42am... Picked up a secondary R2K call block... this open is just the usual nonsense.

Equity bulls welcome the 1900s

It was just another day for the equity bulls, with a new set of historic index highs. The sp'500 has followed the Dow and the Transports, with the R2K/Nasdaq remaining significantly far behind. The bulls look set to control the market possibly as far ahead as mid June.


sp'weekly8b

Summary

There really isn't much to note.

As for the count on the above chart, it remains a 'best guess'. Market could easily get stuck in the 1920s, but with a fair few chartists out there noting it, the 1940/60 zone does look viable in June.


Looking ahead

There isn't much of significance due tomorrow, just PPI, housing data, and the latest EIA Oil report.

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

Having dropped a quartet of longs yesterday morning, I was indeed somewhat itchy to at least have something..and I picked up an index long position this lunch time. To be clear though, I am only interested in trading 'light' on the long side for the next few weeks.

With the broader weekly index cycles all bullish, I can only consider going long the indexes, even though of course, the current levels are historic highs.

A big turn is coming..and the next prime opportunity is arguably the FOMC of June'18, but that is a full five trading weeks away. For those currently short..that is indeed a pretty fair way away.

Goodnight from London

Daily Index Cycle update

US indexes closed somewhat mixed, sp +0.8pts @ 1897. The two leaders - Trans/R2K, settled +0.5% and -1.1% respectively. Near term outlook remains moderately bullish, to at least the sp'1910/20s. Best case upside remains the 1940/60 zone by mid June.


sp'daily5

R2K

Trans

Summary

With new historic highs in the Dow/Trans..and finally... the sp'500, the equity bulls can remain moderately confident..at least for another few weeks.

Equity bears have zero downside power, and it is now a case of how high can the bulls push the current multi-week up cycle..that stretches back to the key low of sp'1814.

Best guess..at least sp'1920..but there is a threat of the 1940/60 zone into the next FOMC of June'18.
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Closing update from Riley



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a little more later...