VIX crushed for a fifth day

Despite opening +6% to 14.93, with equities seeing an immediate reversal, the VIX quickly cooled, and settled lower for a fifth consecutive day, -2.0% @ 13.35. Near term outlook offers very little to equity bears/VIX bulls.. as the market appears able to ignore any bad news.


VIX'60min

VIX'daily3

Summary

*a rather stark bearish engulfing daily candle
--

A classic opening black fail hourly candle in the lower end of the gap zone, and that was a clear warning to the volatility bulls that renewed cooling was due.

No doubt the VIX will pop back into the upper teens at some point... but right now.. that looks some weeks away.

--
more later... on the indexes

Closing Brief

US equity indexes closed moderately higher, sp +13pts @ 2094. The two leaders - Trans/R2K, settled higher by 0.3% and 0.7% respectively. With the Dow having broken the Nov' high, and >18k, the outlook into the summer unquestionably favours the bulls.


sp'60min

Summary

*closing hour action: micro chop, but (as is almost always the case) leaning to the upside, and breaking a new multi-month of 2094.66.
--

... and thus concludes one of the more bizarre trading sessions of the last few years.

Its not even the fact that the Dow broke the Nov'2015 high. Its the issue that with Oil -6% last night.. the market barely reacted, with (at worse) the equiv' of a -0.7% decline.

The fact that indexes then turned positive by 10am was a seriously disturbing thing to witness.

-
Sure, we could easily cool 2, 3.. even 4% by end month, but why would we? Regardless of what the FOMC decide next week, does it even matter?

The market looks damn strong now. It can't be denied.
--

more later... on the continually cooling VIX.

3pm update - two percent away

The sp'500 has come within a mere 2% of breaking the May'2015 historic high of 2134. Considering the markets ability to completely shrug off multiple negative issues, it bodes for further gains into the early summer. The equity bears are losing what little hope remained.


sp'weekly

Nasdaq comp', daily

Summary

Besides the sp'500 and Dow, the Nasdaq comp' is set to re-take the giant psy' level of 5K.

A moderate retrace into end month remains viable.. but the fact we've broken another set of key levels today argues against taking any future downside remotely seriously.

After all.... its all considered bullish now... even a BREXIT vote.
-

back at the close

2pm update - AAPL not at the party

Whilst the broader market remains moderately higher, AAPL is having issues, currently -2.2% in the $107s. Next support is around the $105/103s. Considering the broader market, sustained action <$100 looks out of range.


AAPL, daily

sp'daily5

Summary

As for the broader market, price action remains unquestionably bullish, not least reflected in the Dow.

... and as a fair few will be aware.. some Golden crosses are due on some of the indexes in the near term.
--

Q. Has Gartman capitulated yet?

yours.. not watching clown TV

1pm update - no sunshine for the bears

With the Dow breaking the key Nov' high of 17977, another line in the proverbial sand has been broken through. Regardless of nominal price levels, the real issue is how resilient the market was to an overnight oil smack down and further political upset... it just doesn't care.


Dow' daily

Dow' weekly

Summary

With a break >17977, the Dow has quickly taken out the 18K threshold, which the cheerleaders on clown finance TV have been recently seeking.

Next natural target is the upper weekly bollinger is in the 18300s.. where the May' high is.

I realise some are touting sp'2092 as key.. but really... the markets response to Oil.. and even Brazil.. is arguably far more important.

With the break of the Nov' high, I would argue even if by some miracle we see a cool down to the lower daily bollinger (17400s.. but likely to soon rise)... that no longer matters.

7 trading days.. and the Fed could even get away with a rate rise... and the market would try to take it as a bullish sign... right?
-

Here in London city...

Depressingly appropriate.
--

12pm update - on the edge

US equities remain moderately higher. Most notable remains the Dow'30 index, which has now come within a single point of breaking the critical Nov' high of 17977. Any price action >18K would be highly suggestive that the unthinkable is going to happen. VIX is entirely reflective of ZERO market concern.


Dow'daily

VIX'daily3

Summary

Little to add, on what is truly a day of utter bullshit.

Not only did we see the market only fall by -0.6%.. as Oil imploded by -6% overnight... but it only took the market 30mins to turn positive.

For those as pissed as I am....   maybe take the rest of the day off.

--
*yours truly is still holding short, but I'm beyond tired. Its not even about the $ loss, more so.. about that increasing likelihood that the equity bull maniacs are about to take full control, and then take the market massively higher.
-

back later

11am update - nine Dow points

With the latest bullish news that Doha failed to reach an agreement, and the Brazilian President set to be ousted... US equities are naturally moderately higher. Most notable, the Dow has come within 9pts of breaking the critical Nov'2015 high of 17977.


Dow' daily

VIX'60min

Summary

VIX: imploding from the 14.90s to the 13.50s. The only level to break now is the 13.00 threshold.

--
Arguably, any daily close >17977... is one of the very last short-stop levels to bail.

I realise some will disagree, and instead tout sp'2090 or even the Nov' high of 2116.

In any case... I'm about done with this.
-

notable weakness.. AAPL, -1.6%

10am update - no downside power

US equities open lower, by an unquestionably lame -7pts to sp'2073.. and have already bounced to almost evens. For now, equity bears remain powerless, and from a pure cyclical perspective... just getting to the 2065/61 gap zone will be very difficult today. The 2050s look out of range.


sp'60min

VIX'60min

Summary

*opening hollow red reversal candle for equities, and a clear black-fail for the VIX. It doesn't get any clearer.
---


For the equity bears, this open may as well be Dow +200pts with sp'2100s.

Its frankly pathetic.. and for those touting the sp'2400/500s - as I'm seeing increasingly.. well, you're on track.
--


notable strength... DIS, daily

... and with a laggy stock like Disney on the climb... it really tells the story this morning.

Indeed, for the hyper bullish out there... look for DIS in the $105s.. that'll be a key sign.

Pre-Market Brief

US equity futures are moderately weak, sp -7pts we're set to open at 2073. USD is -0.1% in the DXY 94.60s. Metals are mixed, Gold +$4, whilst Silver -0.1%. Oil is -3.9% in the $40s, after no Doha agreement.


sp'60min

Summary

*overnight action, saw a low equiv' to sp -16pts... 2064, and indeed, equity bears should already be somewhat disappointed.
-

So.. we're set to open lower, but equities are holding up very well relative to the major drop in Oil.

Targets?   Clearly, the gap zone of 2065/61 looks set to be filled today. A close in the 2050s looks difficult though.

Far more important is the most recent key low of 2033. Until that is broken, equity bears should be concerned another higher high is still viable... if not probable.
--

early movers...

CHK -6%
FCX -4.5%
RIG -4.5%, SDRL -7%

*pre-market VIX +6.5% in the 14.50s

Since last week I've noticed I'm getting pre-market VIX quotes. Not sure if other trading screens were offering that... but its new to me.
--


Overnight action

Japan: -3.4% @ 16275
China: -1.4% @ 3033
Germany: currently -0.1% @ 10036
-

Have a good Monday... if you can.