Good morning. Futures are lower, sp -12pts, we're set to open at 1683, a mere 8pts above the recent key low. Precious metals are bouncing, with Gold +$10. Oil is similarly a little higher. Equity bulls have a real problem to start the day.
sp'60min
Summary
*ADP jobs data came in somewhat weak, 166k gains.
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So, all of yesterdays gains are going to be negated at the open. The only issue now is whether the recent low of sp'1674.99 is taken out.
I see a fair few out there touting the 1660s before the next up wave, but then, most of those are calling for massive declines this month.
For the bulls..this could be a long day.
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9.45am.. market looks okay, should have a fair chance to hold the 50 day MA of 1679/80. If it can hold that today, thats a strong sign that the opening declines are to be dismissed.
Equities have started Q4 will some rather important gains, and with the sp' back in the 1690s, the weekly charts are back to outright bullish. The monthly sp' chart is now offering the 1740s later this month. Baring a debt ceiling crisis in a few weeks time, market bulls look set to rule the rest of 2013.
sp'weekly8 - mid term bullish outlook
sp'monthly'2 - bollinger/keltner bands
Summary
The little ramp into today's close was pretty much the sort of nonsense that even I saw coming. Certainly, the market will need to put in a few daily closes above the important sp'1710 threshold before I can get really confident, but that does seem very likely.
With the new month, the monthly charts have seen their bollinger bands jump higher. The sp' upper bol is now 1743, and if we are trading in the 1740s later this month, that will have further risen to the 1750s.
If there is no debt ceiling problem this month, the sp'1800s will become a very valid target for Nov/Dec. The 'hyper-bullish' outlook best guess is for a year end close in the 1850/1950 zone. I realise the 1900s seem a crazy target, but then...few were touting 1700s at the start of this year.
Looking ahead
Wednesday has ADP jobs data. The Bernanke is speaking at 3pm (at some banking conference), although I'm entirely unsure if the media/market will be interested in that particular event.
*there is sig' QE-pomo of $3-4bn, bears...beware!
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So...I'm guessing the market has put in a key turn. The issue now is whether we break a new high >1729..and with continued QE, why would we not?
Yes, there is the debt ceiling issue, and if the US political maniacs can't agree on dealing with that quickly, Mr Market is going to get seriously upset, and we could see a brief..if not very severe equity drop..with VIX most definitely in the mid 20s..if not 30s.
For the moment, I remain long (if currently underwater), and seeking an exit in the sp'1750/75 zone later this month.
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The main indexes closed moderately higher, with the sp +13pts @ 1695. There were enough bullish breaks to suggest that it does appear likely the market is now beginning a new up wave, one that could last into November. Primary target zone is sp'1750/75
sp'daily5
R2K
Trans
Summary
The market opened a touch higher, and with the morning break into the sp'1690s, the market looked pretty comfortable into early afternoon. A natural minor down cycle washed out the weaker bulls, sucked in the bear chasers..and then a little closing hour jump into the mid 1690s.
All things considered, this is very likely a key turn day, and equity bulls will likely see at least some level of further gains into the Friday close.
The transports are especially offering a very clear bull flag..which was confirmed today..and now the 6800s look viable this month..with 7000s in Nov/Dec.
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a little more later.
