Pre-Market Brief

Good morning. Futures are moderately higher, sp +7pts, we're set to open around 1770 - a mere 5pts below the recent high. Precious metals and Oil are both initially higher by 0.5%. Equity bulls remain in control, and new index highs look viable today.


sp'60min

Summary

So much for even a move to the sp'1730s. That now seems unlikely, not least if we are trading >1775 sometime today.

For those who were bravely holding short overnight, this is a lousy start to the day.. well, aside from the TSLA shorts.

*there is sig' QE-pomo today, so..bears face serious problems.
--

Video update from Mr Permabull.



Not surprisingly, Oscar is looking for Trans 7300, along with further downside in Gold...and I'm in agreement with both.
--

Notable movers:  TSLA, -$21 @ $155.   The recent low of $153 is important. if that goes..then target zone is $110/100 within the 'near term'.

How much higher by year end?

Whilst the equity market chops around in the sp'1760/50s, the bigger question is how much higher can the market climb by year end? Certainly, the low/mid 1800s look likely, but the weekly charts will be pretty over-stretched by early December. Some significant year end profit taking seems likely.


sp'weekly8 -mid term bullish outlook

Dow, monthly'2, rainbow

Summary

Unquestionably, the primary trend remains to the upside. The Dow monthly chart is pretty clear. Baring a break <15k, the trend is strongly bullish.

We have the fifth green candle on the weekly 'rainbow' chart, and there is simply nothing bearish right now. Indeed, first support is around the 10MA of 1716..but that is rising pretty strongly, and will be 1750 by end Nov.

Upper bol' on the weekly cycle is offering 1776 in the immediate term. However you want to count this nonsense, we sure aren't trending down. I have to say, I'm utterly bemused how anyone could dare call a top right now, not least with the weekly charts still outright bullish.

Maybe if we get 2 or 3 blue candles by early December, then we can see a little down wave, but even then...post Christmas..we'll more than likely surge higher - just like this past January.


So..how high?

I'm holding to the original outlook I posted some months ago...I'm seeking a yearly close..somewhere in the sp'1850/1950 zone.

Certainly, it will be damn difficult to close in the 1900s, not least since there will be a massive likelihood for year end profit taking. Yet...QE continues at $85bn a month, and the market remains powerfully strong.

There is simply nowhere else for the 1trn of 'new money' to go. Never mind the capital inflows from the EU/Asia. The US capital markets are like a giant vacuum, and US equities look to be strong into spring 2014..before some degree of intermediate multi-month correction.


Looking ahead

There really isn't much of anything tomorrow, aside from the usual QE nonsense.

*there is heavy QE-pomo this Wednesday...bears...beware!
--

A somewhat tiresome Tuesday...so...that is it from me... for today.

Goodnight from London

Daily Index Cycle update

The main indexes closed somewhat weak, with the sp -5pts @ 1762 The two leaders - Trans/R2K, both closed lower by around 0.5%. The near term outlook is moderately weak, but a further wave higher across late Nov/early December seems very likely to take the sp' into the low 1800s.


sp'daily5

R2K

Trans

Summary

Another frustrating day for the equity bears. Those opening declines were weak, and we even saw the Dow see a 129pt swing to trade moderately higher in the afternoon.

There remains an opportunity for the bears to knock the market lower into the sp'1730s this week, but with heavy QE this Wednesday and Friday, it will be very difficult.

Effectively, any downside..is arguably untradeable.
--
a little more later...