Wednesday, 13 January 2016

3pm update - major failure

US equities have seen a decisive failure to hold the Monday low of sp'1901, with a clear snap lower as a truck load of long-stops were triggered - new cycle low of 1886 and VIX 26.11. For now, VIX is still not showing any sign of hyper-upside.




Unlike the past two days... the market has failed to rally, and the failure has resulted in a severe 3.2% swing from 1950 to 1886.

Even if the market can attain a daily close >1900, the damage has been done, and technically speaking, the Aug' 2015 low of 1867 is now on the menu.

Hopes of 1970s in the near term.... fading away.

notable weakness....

CNX -13%
F -5.7%
FCX -10%
RIG -6.6%


TVIX +20%... but interestingly.. .well below the Monday high
GLD +0.5%, with Silver +2.4%.. a clear fear-bid

Super bearish engulfing candle...

Seen on the daily chart.. today's reversal is a HUGE one, and bodes for further downside.

3.01pm.. So.. how low could we implode in the near term?

Well, I highlighted last Friday...

sp'monthly2b, Guppy

Best case for the bears.. a brief spike down to the sp'1730s... aka. .like Jan' 2008.

Were we to hit that level.. even I would consider going long

3.07pm.. Clown finance TV highlighting Albert Edwards...

Sp'500... @ 550... Hmm

3.17pm.. Its getting choppy again... and barring some kind of absolutely bizarre hyper-ramp into next week, the 1970s are out of range.

Any hope of >2K seems ludicrous right now.

The only solace for the equity bulls.. the VIX has not exploded into the 30s

3.33pm... a clear mini short-stop cascade as sp'1900 briefly re-taken.

Regardless of the close.. a major failure for the bulls... as EVERY rally is being sold into.

I realise many will now look for 1867 to hold... but 1750/25 zone IS a valid target within the near term.