With equities settling moderately lower, the VIX clawed higher into the monthly close, settling +3.1% @ 15.07. Across the week, the VIX settled +4.2%. Perhaps most notable, for the month of October, the VIX settled net lower by -38.5%.
VIX'daily3
VIX'weekly
VIX'monthly
Summary
*A rare look at the monthly cycle, but it does merit highlighting, as we've now seen the VIX collapse from 53.29 (Aug 24th) to 12.80 (Oct 28th).
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Suffice to add, the VIX is due an up cycle... and the Fed day spike low of 12.80 will likely not be hit again until December.
At best, an equity retrace to sp'2020/00.. and that might equate to VIX 'briefly' in the low 20s..
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US equities ended the month moderately lower, sp -10pts @ 2079 (intra high 2094). The two leaders - Trans/R2K, settled lower by -0.1% and -0.3% respectively. Near term outlook is for a natural retrace to the sp'2020/00 zone.. where there are multiple aspects of support. From there... broadly higher into year end.
sp'60min
Summary
*closing action.. new intraday lows.. as the sellers finally appeared....breaking the Thursday low.
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.. and October comes to a close. Essentially, all indexes proceeded straight up.. resulting in rather extreme net monthly gains.
Best guess remains.. a moderate retrace to around sp'2020/00 zone.. by mid November. Broadly.. the bigger bearish scenario is off the table.
Have a good weekend.
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*the usual bits and pieces across the evening to wrap up the day, week... and month.
US equities see an outright collapse wave from the new cycle high of sp'2094 to a near horrific low of 2084. Seriously though, a break under 2082 in the closing hour would be a minor victory to the bears.. and offer hope that the market has indeed maxed out.. with a natural retrace set to span 2-3 weeks.
sp'60min
sp'weekly1b
Summary
... the last trading hour.. of what has been an absolutely insanely bullish month.
So.. lets see if we can take out the Thursday low of 2082.. with a weekly close in the 2070s. That'd be something.
Regardless of the exact close.. we're still set for a fifth consecutive net weekly gain.
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notable weakness: DIS, -0.9%...
..updates into the close... if we do break <2082.
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3.03pm.. ohh the humanity... look at the declines! We've taken out the Thursday low!
Next soft target.. 2080... then the 200dma of 2061.
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3.09pm.. the 3 leader stocks, AAPL, DIS, INTC... relentlessly strong.. are all appearing to rollover...
notable weakness, BAC -1.7%...
3.17pm.. VIX +2.5% .. making a play for a minor net weekly gain in the 15s.
3.38pm... chop chop.. with sp'2084.. and VIX 14.95....
Just a touch of weakness into the monthly close... looks due.
With two trading hours left of an insanely bullish month, the sp'500 breaks a new cycle high of 2094.. a mere 40pts (2%) away from breaking a new historic high. Bearish thoughts of the 1800s.. or anything lower should have long faded from even the most bearish of bears.
sp'60min
Summary
Price action remains very muted... on what has been a truly bizarre month.
All US indexes are set for the fifth consecutive net weekly gain.
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notable weakness
TSLA, -1.6%
Price action remains a real mess.. and the Aug' low of $195 looks vulnerable, if the broader market retraces to sp'2020/00 by mid November.
US equities remain in nano scale churn mode... mere consolidation of what are extreme net monthly gains for the sp'500 of around 8.8%.. as reflected in equity markets across the world. For the moment, there is no sign of a turn.. although cyclically we are due a down wave into mid November.
sp'daily5
Summary
Little to add.
I realise some out there are still looking for another 0.5-1.0% to the upside before a turn... certainly possible, but things are looking tired, as reflected in a number of stocks like DIS, INTC.
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Here in London city....
Ironically, the sun finally appeared today.. a mere few minutes before sunset.
US equities remain in churn mode... leaning on the weaker side, as the daily cycles continue to slowly turn back toward the bears after what has been a truly bizarre 5 week hyper ramp from 1871 to 2092. It is notable that a number of the old leader stocks - such as DIS and INTC are looking distinctly tired.
sp'daily5
INTC, daily
Summary
Metals are increasingly weak, Gold -$5, with Silver -0.3%.. and that is with the USD -0.7% in the DXY 96.60s. Surprisingly, GDX has managed to build gains of 0.9%.. but those gains look unsustainable.
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First target for the equity bears should be to take out the Thursday low of 2082.. which is an entire 4pts lower. Considering the price action of yesterday and this morning though, a down wave of that magnitude looks lamely difficult.
After a minor swing from sp'2092 to 2084 (ohh, the drama!)... we're right back to nano scale price churn. There would seem little to expect from the rest of today.. with the sp'500 set for a net monthly gain of around 8.8%. Commodities are leaning on the weaker side, Gold -$4, with Oil holding flat.
sp'60min
GLD, daily
Summary
The weakness in Gold is stronger than it might seem, as the USD is -0.6%.
For now, the miner ETF of GDX is managing to hold flat... but broadly... its not looking so great.
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notable reversal...
DIS, daily
Opening gains to $115.24, but the sellers are increasingly appearing.... earnings due next Thursday.
Best case downside is arguably the 200dma.. around $108. Anything much under that looks extremely difficult.. not least as the sp'500 is not going to fall to 2000 next week.
US equities open a touch higher, with the sp'500 testing the Thursday high of 2092. The daily MACD cycle is continuing to swing back in favour to the bears. USD is cooling, -0.4% in the DXY 96.80s. Metals are weakening already.. Gold -$3. Oil is back to flat.
sp'daily5
VIX'60min
Summary
*Chicago PMI: 56.2.. a real bullish surprise.. and well above the recessionary 50 threshold.
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Clearly, equity bears need to take out yesterday's low of 2082 to offer a provisional indication we have a short term top.
As things are... other than slight natural cyclical bias to the downside.. there is little to expect from today.. other than tedious micro chop.
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re: daily MACD (blue bar histogram) cycle. At the current rate, we'll see a bearish cross next Wednesday.
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Regardless of the exact close today, the net monthly gains have been extreme... and 'white flag' waving time was arguably a good 100/150pts lower down.
Good morning. Equity futures are a little higher, sp +5pts, we're set to open at a new cycle high of 2094. USD is cooling, -0.3% in the DXY 96.90s. Metals are trying to rebound, Gold +$2. Oil +1.0% in the $46s.
sp'weekly1b
sp'monthly1b
Summary
Unless we see a sig' reversal later today.... the market is set for the fifth consecutive net weekly gain. It would seem the only issue is whether we close a little below... or above the sp'2100 threshold today
More critically, the market will see a monthly close above the 10MA.. and by a rather decisive 2% or so.
The equity bears failed to hold key resistance in October, and there is now little reason to believe it won't be a case of 'broad gains' all the way into late spring 2016.
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Over Asia action...
Japan: +0.8% @ 19083... resilient.. with an Oct' close in the 19000s
China: -0.1% @ 3382... unable to hold the 3400s, but still... a net monthly gain of 10.8%
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Whilst equities traded in a very tight range, there was more notable movement in US bonds. TLT settled lower by a rather significant -1.5% @ $121.91. Broader price structure is increasingly tight, with various indicators suggestive that bonds are vulnerable.
TLT, daily
TLT, weekly
TLT, monthly2
Summary
*yes Doug, this post is due to you.
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I realise few care, but the bond market does have relevance for those who only trade equities.
Often is the case, bonds can lead equities, or provide indirect confirmation of an equity turn/move.
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What next for bonds?
Daily cycle... a clear black fail candle at declining resistance a few days ago, confirmed with today's sig' decline.
Weekly: the third consecutive weekly candle with a somewhat spiky top... bearish
Monthly: another blue candle, trading under the monthly 10MA.... a lower high... bearish
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Broadly, bonds look highly vulnerable to much lower levels - first target for TLT would be the $100/95 zone, not least if the Fed does eventually raise rates.. even if only a little.
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Interest rates...
Fed rates, with sp'500
It should be obvious to almost anyone that the US Federal reserve has always been REACTIVE to events, it has never been proactive. Rates have always been raised too late in each economic cycle, and it remains hugely ironic that each time the Fed does cut rates, it is a key signal of impending economic/market doom.
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Closing update from Riley
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Looking ahead
Friday does have an array of data... pers' income/outlays, Chicago PMI, employment costs, consumer sent'
The market is expecting a PMI of 49.2... which by definition is fractionally recessionary.
*Fed official Williams is due to speak at 10am on the 'direction of interest rates'. I would imagine the market will take some notice of that.
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US equities closed somewhat mixed, sp -0.9pts @ 2089. The two leaders -
Trans/R2K, settled +0.8% and -1.1% respectively. Near term outlook
remains seeking a break lower... with at least the sp'2050s viable next
week. Primary target by Nov' opex will be around the sp'2000 threshold.
sp'daily5
Trans
Summary
Little to add..
All equity indexes are due a retrace, having seen a massive ramp across the last 5 trading weeks.
First target is the sp'2020/00 zone.. which frankly.. is not that bold a target.
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