Monday 18 June 2018

Lower highs, lower lows

US equity indexes closed moderately mixed, sp -5pts (0.2%) at 2773. The two leaders - Trans/R2K, settled -0.2% and +0.5% respectively. VIX settling +2.7% at 12.31. Near term outlook offers sig' downside to 2734, with minimum technical necessity of 2718.




Equities opened moderately lower, seeing an early floor of 2757. Once again, there was a latter day recovery, with the sp' settling just a little lower at 2773. The daily candle was a hollow red reversal, which is normally a sign of a s/t floor. However, we do have another lower high and a lower low, which is supportive of further weakness. Underlying MACD (blue bar histogram) cycle is set to turn negative on Tuesday, and that offers first opportunity of significant and sustained downside. In theory, 2734 is a magnet, with prime technical target of 2718. The latter really should be seen.

The R2K broke a new historic high, and is a reminder of underlying m/t market strength.

Volatility remains broadly subdued, with the VIX seeing the upper 13s, but settling in the mid 12s. The 15/16s look due in the immediate term.

Extra charts in AH (usually around 7pm EDT) @

Goodnight from London
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