Friday 30 May 2014

Volatility melts into the weekend

With equities holding largely flat, the VIX was once again in melt mode, settling -1.5% @ 11.40 - the lowest monthly close since Jan'2007. Across the week, the VIX gained 0.35%, whilst across the month, VIX fell a very significant -15%





Indeed, most was the lowest monthly VIX close since Jan'2007. We're right back to levels/price action not seen since the peak of the property bubble.

Of course, this sure doesn't mean the VIX has floored, the 10s do look likely in June, perhaps even the 9s.

Considering the monthly equity charts though, I'm still seeking some kind of multi-month down wave, which should equate to VIX back in the 20s...later this summer. Whether we can go much higher than the 2013 high of 21, that remains the big unknown.

more later...on the indexes

Closing Brief

US equities closed the week..and the month on a positive note, with rather typical algo-bot melt, sp +3pts @ 1923. The two leaders - Trans/R2K, settled -0.1% and -0.5% respectively. Near term outlook offers further upside into next Wednesday.



..and another month comes to a close.

This was month'32 of the grand wave from Oct'2011.

I continue to have the hope (if smaller each day), that we'll get stuck this June..or July.

Problem remains - at least as I see it, even if we do eventually see a strong (if brief) 2-3 month wave lower, the central banks will go crazy with the PRINT button, with the market rebounding even stronger than it did in late 2011.

I hold to the original 'grand outlook' that we'll see broad upside into late 2015/early 2016. More on that later this evening though...

*I am entirely on the sidelines, and have little intention of getting involved until at least next Wednesday. I'd consider a minor short side trade..perhaps...based on possible disappointment at the next ECB of June'5.

Have a good weekend
*the weekend post will be on the World monthly indexes

A late afternoon update from Riley, which will likely suffice for the weekend


3pm update - minor chop into months end

May is set to close with net monthly gains for all the US equity indexes. Even the battered R2K/Nasdaq are higher by 0.6% and 2.9% respectively. Not exactly bearish, is it? Meanwhile, precious metals will close the month on a weak note, with net monthly declines of around -3%.



A short week, but...overly tiresome, I will welcome the weekend...and good riddance to May. For the was simply another month to forget.

Notable weakness: TWTR -4% or so, but gains on the week.

Coal miners looking dire, but more on them..after the close, on my 'fair value' page.

Meanwhile...whilst the VIX is set for the lowest monthly close since Feb' 2007 (ahh yes, the property bubble peak), clown finance TV are focused on far more important things... such as what clothing one of their guest should wear.

Clown finance TV... indeed
Yeah...the clown pants would be appropriate.


3.30pm.. the only issue this closing much might the VIX be knocked lower into the it almost always is.

I don't expect 10s today..but June.

back at the close

1pm update - tiresome chop

US indexes slip a little, but again, there really isn't any power behind the move. Maybe a few of the rats will want to sell into the weekend, regardless, May was a positive month. Metals remain weak, Gold -$10, with silver -2.0%



Little to add, on what is starting to be come a tiresome day.

Notable weakness: the miners, BTU -3.7%, 

TWTR -4.6%... momo chasers..not appearing today.

2.05pm.... nothing to add.  

 back at 3pm.

12pm update - fractional new highs

Equities remain stuck in what is essentially algo-bot melt mode, with fractional new historic highs in the Trans and the sp'500. Metals remain weak, Gold -$10, with Silver -1.4%, with a particularly bearish outlook for June. VIX looks set to close May in the 11s.

GLD, monthly

Trans, monthly


*ignoring the smaller cycles....ohh, and don't get overly fixated on the GLD wave count. Point is...trend remains broadly lower, right?

Gold/Silver look VERY bearish for June, with the 2013 lows set to be broken.

VIX update from Mr T. (due)

time for tea

11am update - minor excuse for a down wave

With Fed official Plosser making an appearance on clown finance TV, the market has an excuse to sell lower..if only a little. Precious metals are especially weak, with Gold -$10, and Silver -1.0%.



Well..lets see if Mr Market wants to shake out a few of the weaker bulls...first downside zone is 1912/10 or so..with a much clearer gap zone of 1902/00. I sure don't expect the latter today though.

From a purely cyclical perspective, we are due a down cycle today, but as ever...underlying pressure remains UP.

Hence.. I ain't getting involved, never mind the bullish weekly cycles.

time for an early lunch.

11.16am.. So much for a micro down cycle..... new high on the sp'500.

Market appears in algo-bot melt mode...and that could easily last another 2-3 days.

10am update - chop into the weekend

US indexes open a touch lower, but the underlying upward pressure is no doubt still there. A positive daily close would merely be a bonus to the equity bulls. Metals remain weak, Gold -$5, with the mining stocks again on the slide, GDX -0.1%



*Chicago PMI comes in at 65, which is the highest reading since mid 2011.

I'm not quite sure what I will posting today, I will probably try to stick to the bigger cycles, after all, it is months end.

We're set for the fourth consecutive monthly gain, and primary trend remains bullish. The monthly 10MA will be around 1825 in June, so..that would be 'core support'. Anyone think we have a chance at break <1825 next month....because I don't.

I see more talk about a Bradley turn date in mid July. I'd guess that is more likely a high than a low. Sp'1940/60 zone...perhaps...with VIX 10/9s.

I'll maybe post some speculative outlooks across the day.

notable movers: TWTR -2.8%, although that is after huge gains earlier this week.

CHK -1.5%,  FCX -1.5%...

10.28am...ohoh.. Fed official...on the loose....on clown TV...coming up...

market will react....

5/15min index cycles..look toppy..........first downside would be 1912/10 zone.

...good luck to the day-trading bears out there....

Pre-Market Brief

Good morning. Futures are a touch lower, sp -2pts, we're set to open at 1918. Metals are ending the week poorly, Gold -$3. Equity bulls look set for a positive end to May, with further upside into the sp'1925/30 zone, early next week.



Without getting wrapped up in the minor noise, it'd seem the bulls remain in full control.

*we do have some semi-key econ-data today, notably, the Chicago PMI (9.45am). I suppose if those come in below expectations, there is a chance of a minor down wave..but really. underlying pressure remains strongly positive.

The next thing the market will need to deal with is the ECB next Thursday. I do NOT see an announcement of QE, but rates will probably be reduced.

For now though.. bulls have another 3 or 4 days of viable upside.

Video update from Oscar

Oscar has been flip-flopping more than a US politician lately, and now that we're in the 1920s...he is back to bullish.

Well, its the end of the month...and without was another tough one for the bears...especially those who were short the R2K/Nasdaq.

Another day of new highs

Once again the US equity market broke new historic highs - Trans (8110) & Sp'500 (1920), with the Dow looking set to follow. The only issue is whether the R2K and Nasdaq are going to break the early March highs.


R2K, weekly'4, rainbow


So...another pair of new historic index highs, and the price action remains very bullish. We have 7 consecutive green candles on the sp' cycle, and even the laggy R2K is back to bullish green.

I'm still guessing the R2K is headed to at least 1170/80, but if it can break into the 1200s, then the bigger H/S formation will get dropped.

A flashback to 2007

I will continue to give Schiff plenty of flak for his incessant 'dollar doom' talk, but hey...I'll also sure as hell enjoy giving everyone periodic reminders that he was one of the few brave ones warning about the property bubble.

Seeing these videos never fails to amuse me. It is Incredible to reflect upon that most of the mainstream analysts who completely failed to see the bubble for what it was...never lost their jobs.

Looking ahead

There is a trio of econ-data tomorrow, Pers' income/outlays, Chicago PMI, and consumer sentiment.

*next sig' QE-pomo is not until next week. There is a new QE schedule to be issued, Friday, 3pm

Goodnight from London

Daily Index Cycle update

US indexes closed with moderate gains, sp +10pts @ 1920. The two leaders - Trans/R2K, settled higher by 0.4% and 0.3% respectively. Near term outlook is for continued upside, with the weekly charts offering sp'1925/30 next week.





*most notable, new historic highs for the Trans and sp'500.

So..the broader multi-week up cycle continues, with ZERO sign of this levelling out..never mind actually rolling lower.

Clearly, this can't go on forever, but another few weeks....why not?

Closing update from Riley

a little more later...