Tuesday 10 June 2014

Closing Brief

US equities saw very minor weak chop across the day, sp -0.4pts @ 1950. Near term outlook remains broadly bullish, and the sp'1960s are just about viable by this Thursday. Market will be gradually shifting its attention to next weeks FOMC of June'18, when QE taper'5 will be announced.



*yesterdays chart will suffice, right? Who will notice its a day old anyway?

So..a day of very minor chop, although there were certainly some notable gainers..and losers.

On the down side...coal miners, BTU, -1.5%, King Obama's 'war on coal' continues to great success - at least in term of stock prices for the coal sector.

Notable strength in the momo arena, FB +4%, with TWTR +2% or so.

As for the usual post-trading day updates....err..no.

If stockcharts manages to reboot before I sleep, I'll post a single late evening post...other than that.....

back at the Wednesday open.

*I hold moderately LONG overnight, via WFM, seeking an exit in the 43/44s, which does seem viable later this week.

3pm update - are you fond of sand dunes and salty air?

US equities are set to close broadly flat, although the smaller 5/15min cycles are still offering a small up wave into the close. A daily close in the sp'1950s is most certainly viable. Metals have flat lined since the open... but set for moderate gains, Gold +$7

sp'monthly8 - QE phases


*a somewhat annoying day without stockcharts...

The FOMC of next Wed' ,set for QE-taper'5, bringing the QE fuel down to $35bn a month, a mere $420bn annualised.

Certainly, volatility will likely see a minor spike next week, 14/16 zone, but no higher.

VIX 20s look unlikely until at least late July..if not Aug/Sept.

Meanwhile....on what is a fine summers day in London city...

*I will hold LONG overnight, via  WFM.

3.26pm... ..and the indexes start to turn green....

Song for ...traders...


3.43pm... Nasdaq +..... most other indexes a mere fraction negative. Only the R2K is moderately weak, -0.25%..'noise' in the scheme of things.

VIX still set to close fractionally red.

2pm update - minor up cycle due

US indexes continue to see minor weakness, but with two full hours to go, there is high likelihood of a minor wave higher into the close. The sp'500 looks set for a daily close in the low 1950s..which will keep the door open to 1960s by early Thursday.

sp'500 vs CRB


*chart from yesterday close.

The disparity between equities and stocks remains almost as wide as ever.

I suppose the inflationists would say that commodities are merely consolidating sideways before the next lurch higher..and I'd be inclined to agree.

However, the one problem would be a rising USD..which as noted earlier..appears likely to rise across the summer/autumn.

*I remain LONG, via WFM, I'd prefer a daily close in the 42s..that would keep viable the 43/44s later this week.

back at 3pm

1pm update - more of the same

US indexes have been effectively flat lining since early morning, with sp -3pts @ 1947. VIX is close turning red, after earlier minor gains. Metals continue to hold moderate gains, Gold +$7



*above chart from yesterday.

Suffice to say...minor chop..and whatever selling there is, is being negated by today's sig' QE-pomo.

I'd give high likelihood to the indexes clawing back to fractionally positive by the close.

back to the kitchen...

12pm update - who needs charts anyway?

US equities continue to see micro chop, with the sp'500 comfortably holding the 1940s. A daily close back in the 1950s looks very probable, which keeps open the door to 1960s for Wed/Thursday. Metals are holding moderate gains, Gold +$7.

WTIC Oil, monthly'2, rainbow


*Stockcharts remains offline...

Oil remains an interesting one, stuck in an ever tighter trading range. Those touting for inflation - due to the Fed printing, really ought to remain mute until we see a clear monthly close above $110. Similarly, the doomer deflationary bears nothing to get excited about unless Oil slips <$90..if not a more decisive $80.

In many ways...the Fed - and OPEC, probably have Oil prices just where they want them.

VIX update from Mr T.

*I continue to hold WFM, and it is seemingly still okay, despite the fact that yours truly has bought into it.
time for a spicy lunch

11am update - morning chop

US equities continue to see minor weak chop, sp -2pts @ 1948. VIX is holding minor gains, +1% in the 11.30s. Metals are holding moderate gains, Gold +$8.

USD, monthly2, rainbow


*stockcharts is still offline..so no recent charts...

As for the above chart...well, USD looks floored to me. Monthly MACD (green bar histogram) cycle is starting to turn upward..and it bodes for downward price pressure on ALL $ denominated assets this summer/early autumn.

Of course, that sure doesn't mean equities (or Gold/Oil) can't rise, but the downward pressure IS there, and is important to keep in mind.

*I hold a small LONG position, WFM, am seeking the 42/43s in the near term. 

10am update - where we're going...

US equities open with minor mixed chop, sp -2pts @ 1948. There remains notable strength in Gold and Oil, higher by $8, and 0.3% respectively. VIX is making a play for the 'glorious 12s'....but even the mid teens look well out of range.

sp'weekly, 1998


...we don't need charts.

*stockcharts is currently offline..so....err...I'll post some other things.

I've always had an interest in the 1998 collapse wave..it was strong..but brief. In many ways..somewhat like summer/autumn 2011.

I still have the vain hope we'll see something like it later this year, but clearly, for now...we're still pushing broadly upward.

Meanwhile, WFM is higher by around 1%

9.55am.. I am LONG WFM from 41.60s... seeking an exit in the 42/43s..within a few days.

10.13am.. sp'1945...just a few pts away from multiple aspects of support.

QE will be kicking in ...soon.   Would not surprise me to see a brief foray into the 1960s today..or tomorrow...with perhaps..a little weakness/chop later in the week.

Pre-Market Brief

Good morning. Futures are a little lower, sp -4pts, we're set to open at 1947. Metals are higher, Gold +$7. Oil is set to build on strong Monday gains, +0.4%. Regardless of the opening hour or so, with sig' QE-pomo of around $3bn, equity bulls still have everything in their favour.



So...we need an early fall of around 10/12pts to retrace to the small gap zone, which is where the lower bollinger on the hourly cycle will be.

It looks possible, but from there...up. The QE is pretty significant today, and it should be able to negate whatever declines we have in late morning.

*I still have eyes on WFM, although it doesn't look like it will even get to my low $40s initial target.

9.34am.. Stockcharts is offline..so..err..today could be devoid of charts...

Still breaking new highs

US equities continue to break new highs, with even the R2K rapidly catching up to the broader market. The next minor hope for the equity bears would be the FOMC of June'18th, when perhaps the Yellen will say something on interest rates.



We're now at 9 consecutive green candles on the weekly 'rainbow' chart, and only the FOMC of next week offers the first real chance of an end to the current multi-week up wave.

All things considered, it looks like we might see a minor retrace starting next week, but with a further (small fifth?) into early/mid July.

For me..I will certainly consider an index short..if 2-3 blue candles in mid/late July. I suppose there is a possible short index play viable next week.

The bearish R2K scenario...soon to be scrubbed.

R2K, weekly2

I do not expect this to play out, arguably any price action into the 1190s should be enough to scrub the scenario, 1200s to be more decisive.

Looking ahead

The only thing due tomorrow is wholesale trade data, but I don't place much importance on that data point.

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

Goodnight from London

Daily Index Cycle update

US indexes broke new historic highs in the Trans, Dow, SP, and NYSE comp. Even the R2K and Nasdaq are playing catchup, and look set to continue pushing higher into the next FOMC of June'18. There is likely further upside into July.





*We're in the magic box on the R2K, but I no longer expect a H/S scenario to play out.

The current wave is a pretty powerful one, and we are indeed getting real close to the giant psy' level of sp'2000.

With the weekly cycles set to max out within the next few weeks, I'm somewhat suspicious that we won't actually break the 2000 level..at least for another month.

Regardless, there is ZERO downside power, and equity bears would do well to just sit on the sidelines.

Closing update from Riley

a little more later...