VIX jumps into the close

With US equity indexes seeing some distinct weakness into the close, the VIX turned positive, settling +5.9% @ 16.26. Near term outlook offers the sp'2025/15 zone, which would likely equate to VIX briefly in the 17/18s... before cooling into opex.


VIX'60min

VIX'daily3

Summary

Suffice to add... sustained action above the key 20 threshold looks out of range in the near term.

Indeed, even if the VIX is trading in the 17/18s by early Wednesday, it will likely then melt back to the 15/14s by the Friday close.

Regardless of the near term 'choppy action', VIX 30/40s look highly probable between mid-May and late June.
-

more later... on the indexes

Closing Brief

US equity indexes closed moderately weak, sp -5pts @ 2041 (intra high 2062). The two leaders - Trans/R2K, settled lower by -0.5% and -0.3% respectively. Near term outlook offers the 2025/15 zone this Tues/Wednesday, before crawling upward into the Friday opex.


sp'60min

Summary

Closing hour action: very distinct weakness into the close, as the equity bull maniacs themselves look increasingly tired.

**Equity price action seems to be preceded by underlying VIX strength.

Most notable.. VIX held rising trend this morning.. whilst equities saw a failed break above declining trend/resistance.
-


So.. an annoying open.... a lot of tedious chop... with a rather interesting closing hour.

Equity MACD (blue bar histogram) is in the process of turning negative, and could (in theory) tick lower across all of tomorrow.

Arguably, bears best opportunity for a short term exit - late Tuesday/early Wednesday.


*I remain short, am increasingly twitchy about getting an exit in the 2020/10s, along with VIX 17/18s.
-

more later... on the VIX

3pm update - weak chop into the close

US equities remain moderately higher, with probable minor price chop into the close. VIX remains subdued, -1% in the low 15s. Metals are holding strong gains, Gold +$17. with Silver +3.7%. Oil is +2.5% in the $40s.


sp'60min

VIX'60min

Summary

Regardless of whether we close moderately higher.. or fractionally red.. its been a tediously frustrating day.

Even a move to the sp'2020/10s is proving to be very difficult.
-


3.20pm.. sp'2049...  VIX 15.50s... borderline interesting, but still..... I'm way past tired of this.. and it ain't even Wednesday.

*at the current rate.. we'll see a snap lower tomorrow morning... so.. the setup does favour the bears... but clearly..  need <sp'2033 to cause some trouble.

2pm update - 4900s are tough for the Nasdaq

Whilst the broader market looks increasingly vulnerable for the remainder of today, it is notable that the Nasdaq comp' made another attempt to break back into the 4900s. The current black-fail candle is very natural considering what is a massively important threshold.


Nasdaq comp', daily

Summary

Little to add, on what is a pretty frustrating day of moderate chop.

Even if the market closes fractionally lower, the sp'2020/10s aren't exactly the most exciting prospect in the scheme of things.

Clearly, anyone hoping for 'crashy downside' really needs to walk away until mid May/June.

-
notable strength... miners, GDX, daily

Essentially, open air to the $23/24s in the near term. If the main market does implode, with Gold soaring on a 'fear bid' this summer, then GDX actually has (in theory) hyper upside to the 35/40 zone.

For the moment, I ain't involved in the metals/miners, and I'm increasingly annoyed with myself.

--
back at 3pm

1pm update - its getting annoying again

US equities remain moderately higher, with the market making another push higher, sp +8pts @ 2055. The VIX remains broadly subdued, -1% in the 15.10s. Metals are holding very significant gains, Gold +$17, with Silver +3.7%. Oil is +2.1% in the $40s.


sp'60min

VIX'60min

Summary

*again, Oil is helping prop up the broader market.  Doha (April 17th ?) can't come soon enough.
--

Little to add.

If we close in the sp'2060s, its a serious problem.

As it is, anyone with a 2060 short-stop has already been washout anyway.

--
notable strength, miners, GDX +4.9%

12pm update - headed lower

Despite an opening break above resistance, the market appears headed lower. First soft target is the price cluster zone of sp'2025/20. More alluring though, the 2015/10 zone, where the 200dma is lurking, along with a few other notable aspects of support.


sp'daily5

VIX'daily3

Summary

No doubt a few equity bears were short-stopped out with the brief break >sp'2060, and are now already particularly moody.. as the market now looks set for net daily declines.
 -

notable strength: precious metals, Gold +$17.

GLD, daily

Again, its arguable that the precious metals were an early warning this morning that the equity gains would not hold. Something to keep in mind in the weeks.. and months ahead.

--
time for lunch

11am update - failed break

US equities remain net higher, but there is currently a clear failed break above declining trend/resistance from an early high of sp'2062. The hourly cycle is on the high side, and a net daily decline is now on the menu. Still... the equity bears have a lot to do... just to build a buffer zone from the key mid term high of 2075.


sp'60min

VIX'60min

Summary

*note how the VIX held the short term upward trend.. whilst equities broke (but failed to hold) above.
--

Well, I'm trying to get some things done today.. am just checking in near the top of each hour. I don't wish to get lost amongst the minor noise.

Suffice to note.. its fractionally interesting right now, but the fact we haven't already broken into the 2010s.. is increasingly annoying.

--
time to shop...  back soon

10am update - opening gains

US equities open moderately higher, but the gains look somewhat vulnerable. With the USD -0.3% in the DXY 93.90s, the metals are powering upward, Gold +$15, with Silver +2.8%. The related mining stocks are seeing a clear breakout above recent highs.


sp'60min

VIX'60min

Summary

*removed H/S scenario on the hourly equity chart, seems invalid with renewed gains.
--

So, will the gains hold?

If the market can break above sp'2060, then... yes.. we'd almost certainly see a net daily gain.

It could be worse for the bears... but really. this is a pretty lousy start to the week.

--
notable strength... miners, GDX, daily

A fifth day higher for GDX, and its clearly breaking out. In theory, that is an indirect bearish signal for equities.

Pre-Market Brief

Good morning. US equity futures are moderately higher, sp +7pts, we're set to open at 2054. USD is -0.1% in the DXY 94.10s. Metals are back on the rise, Gold +$9, with Silver +1.4%. Oil is +0.4% in the $39s.


sp'60min

Summary

*as most will now be aware, there is a a Fed meeting today, but a closed one.

Notably, after the meeting, Yellen is due to then go meet the US President and Vice president. Speculation is rife on what that might be about.

The Fed is not political, right?
--

As for equities, well, the open sure isn't going to be great for those short.

It remains simply the case.... holding under the recent highs of 2060 and '75, or...a massive breakout. Its one or the other.
-

re: Gold/Silver: The precious metals are increasingly strong, and based on the action from late Dec-March, that could be argued is indirect bearish for equities. No doubt the weaker USD is currently helping.

--
Overnight action

China: +1.6% @ 3033
Japan: latter day recovery, -0.4% @ 15751
Germany: currently +1.1% @ 9730
--

Have a good monday