VIX remains in cooling mode

With equities settling significantly higher, the VIX remained in cooling mode,  settling -8.7% @ 24.50. Near term outlook is borderline. Mid-term outlook for US equities remains bearish, and higher levels in the VIX remain probable across the weeks.. and months ahead.


VIX'60min

VIX'daily3

Summary

Little to add.

It is notable that the VIX continues to sustainably hold above the key 20 threshold.

There is threat of another push higher.. at least to the 29/30 zone... if sp'1867 is fully tested.

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more later.. on the indexes

Closing Brief

US equity indexes settled significantly higher, sp +35pts @ 1920. The two leaders - Trans/R2K, settled higher by 1.1% and 1.5% respectively. Near term outlook is borderline... within a broader mid-term downward trend.


sp'60min

Summary

*closing hour action: renewed upside to the hourly upper bollinger... 1920.. borderline break of trend.
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... and September trading comes to a close.

Frankly.. today was a pretty bad end to the month... but the mid-term bearish trend is clearly intact with a second bearish month.

I am increasingly concerned we'll see a renewed push toward the 200dma in the sp'2040/50s... but for now.. that is indeed a borderline situation.

... and yes.. I'm holding short... at least for now.

Have a good evening

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*the usual bits and pieces... to wrap up the day.. and month... later.

3pm update - a second bearish month

Despite net daily gains, the equity bears are going to achieve the second consecutive significant net monthly decline - sp'500 -3% or so, something not seen since Sept' 2011. The broader upward trend remains broken, and lower levels still look due.


sp'monthly

sp'60min

Summary

*Clearly, any sustained price action >1920 would be a major problem.

.. I'm tired.. and unless things spiral back <sp'1900... I'll merely return at the close.. to wrap up the day.

2pm update - battle continues

US equities push back upward, with the sp + pts @ 190  . Equity bears should remain desperate to at least see the market hold under declining resistance, which will be around 1915 at the monthly close. VIX remains naturally under pressure, - % in the 25.   .


sp'60min

VIX'60min

Summary

For now.. its getting borderline again.

More problematic, the daily MACD equity cycles which at the current rate will see a bullish cross (for most indexes) within 2-3 days.

*notable weakness, commodities, Gold -$12, with Oil -0.3%.
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back at 3pm

1pm update - somewhat interesting

US equities continue to cool from the morning high of sp'1916 to 1897. Price action appears similar in style to last Friday.. where the indexes turned red in late afternoon. Considering it is end month.. net daily declines are within range.


sp'60min

sp'weekly6

Summary

*again, it is notable that the bigger weekly cycles remain outright bearish, and highly suggestive of lower levels in the immediate term.

The Tue' low of sp'1871 makes little sense as a key low.. not least as the R2K busted the Aug' low of 1100 some days ago.
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So... 3 trading hours left of September.. the early morning bullish hysteria has already rapidly faded.

Now its a case of whether we close the month on a particularly stinky note.

Those resolutely holding short can start to breathe again... at least until tomorrow.

12pm update - similar to last Friday

US equities are holding sig' gains, with the sp +23pts @ 1907, yet the setup is similar to last Friday. With 'end month' issues due this afternoon, there is distinct threat of some cooling back under the key 1900 threshold. As things are... the sp'500 is due for a net monthly decline of -66pts (3.3%).


sp'60min

sp'monthly

Summary

Little to add.

So... a second consecutive bearish month.. but is that it? Are we now going to battle straight up to the 200dma in the 2000s?

It is a scary thought.. and the rest of today will offer a hint of whether we'll start Oct' on a down note.

*I remain short... but if we see any sustained price action much above sp'1920.. I'll likely have to close out.

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VIX update from Mr T




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time to cook
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**Bonus chart**

sp'weekly6

Despite this mornings gains.. the weekly candle remains outright bearish. Something to consider.
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12.24pm.. sp @ 1900.... which is somewhat interesting.

Frankly, considering the opening.. I'd settle for any close <1900.  A red close is now within range.. so... rest of today.. could be a little exciting.
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notable weakness: DISCA -4%... downside follow through from yesterday... not a pretty daily chart.

11am update - higher low.. or lower high?

US equities remain significantly higher, with the sp +29pts @ 1913. There is rather critical declining resistance of 1915 at the close of today.. and equity bears should be desperate for a close under it. VIX is naturally cooling, -6% @ 25.00... but offering a reversal candle... much like last Friday morning.


sp'60min

sp'daily5

Summary

The ultimate issue now is whether the next smaller down cycle merely puts in a higher low.. or breaks <1872.

The daily MACD cycle is starting to tick upward... and if it holds into today's close..  its a major threat for those holding short... including yours truly.

So.. I'm awake.. getting my ass kicked... and wondering if we have a marginally higher low of sp'1872... or if this is just end month nonsense.

What should be clear... the month will STILL end net lower.

stay tuned.... 

10am update - opening gains

US equities have opened significantly higher, with the sp' already hitting a high of 1915.. with VIX in the 24s. However, the market remains vulnerable to another reversal. Right now, bears should be battling for a monthly close under the sp'1900 threshold.


sp'60min

vix'60min

Summary

*.. fell asleep... am back now.... I guess the market opened without me.
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brb...
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Okay... so.. we have an opening reversal candle in the VIX. ... just like last Friday.  VIX has now filled the opening Monday price gap..... so we can go to the 30s now.... yes?
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... catching up on some of the data....

so.. ADP jobs 200k.... broadly inline

Chicago PMI, a recessionary 48.7.... reflecting the Sept' upset.. esp' in foreign markets.


10.31am. Oil inventories.. 4 million increase..... and that is not helping Oil prices.. back to flat.

Recent price action is increasingly tight though... a big move is coming. 

Pre-Market Brief

Good morning. Equity futures are significantly higher, sp +23pts, we're set to open at 1907. September is coming to a close, and despite current gains, the sp'500 is on track for a second net monthly decline of around 3%.


sp'60min

sp'monthly

Summary

For those holding short overnight, this is clearly going to be a lousy open, but then, the bears have been in this situation a fair few times in recent weeks.

So... why the early gains? Difficult to say.. although technically, the hourly cycle is set for a bullish MACD cross at the open.

It will be important that the equity bears at least keep the market <1915 at the Wednesday close... at least to maintain the broader downward trend from sp'2020.
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Overnight Asia action:

Japan: broad strength from the open, +2.7% @ 17388, no doubt part of that will be due to BoJ buying.

China, moderate strength, but still holding close to the 3K level, with the Shanghai comp' settling +0.5% @ 3052.
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We have a long day ahead... to wrap up what has been a pretty wild month.

Today was day 9

US equities vainly tried to rally, but broadly failed, with the sp'500 settling +2pts @ 1884, having seen a new cycle low of 1871. Wednesday will offer a break of the Aug' low of sp'1867, and that will then quickly lead the market to 1820.


sp'daily5d

sp'weekly8b

Summary

Suffice to say, broadly, it was a day for the bears, with new cycle lows all over the place.
The bigger weekly cycle remains outright bearish, with best case downside to the 1700s this Thurs/Friday.
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Looking ahead

Wed' will see ADP jobs, Chicago PMI, and the latest EIA oil report.

*Yellen is set to appear at the St' Louis Fed, I'm not aware if that will be covered live. No doubt the event will get some media attention after last Thursday's 'issues'.
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Positioned for day'10

Tomorrow is day 10 since the FOMC high of sp'2020, and in theory.. it should be a fiercely bearish day. It would not surprise me if we are trading somewhere close to sp'1820 with VIX exploding into the mid 30s. Of course, it sure would help if the Shanghai comp' loses the 3000 threshold overnight... along with the Nikkei -2% or more. That would help spiral the EU indexes lower... and help the sp'500 achieve a straight forward gap under the Aug'24/25 low of 1867.

Yours truly is holding short overnight, and seeking an exit around sp'1820.. whether tomorrow or Thursday.

Goodnight from London

Daily Index Cycle update

US equities settled moderately mixed, but well below their morning highs, sp +2pts @ 1884 (intra range 1899/1871). The two leaders - Trans/R2K, settled +0.3% and -0.6% respectively. Near term outlook is for further downside to at least sp'1820.


sp'daily5

R2K

Trans

Summary

*the R2K continues to lead the way lower... first target is the Oct' 2014 low of 1040.. which would equate to sp'1820.
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Trans looks headed for the giant 7000 threshold.. .which seems possible this Thurs/Friday.

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a little more later...