Pre-Market Brief

Good morning. Futures are moderately lower, sp -7pts, we're set to open at 1921, breaking the key double floor of 1926/25. A key hit of the lower weekly bollinger in the low 1910s looks a given today... which might equate to VIX 19/20.


sp'daily5

Summary

So.... we've taken out the key low... and we're continuing on our way lower.

Primary target looks to be the 200 day MA on most indexes, certainly sp'1904 looks viable today.

To be clear..... I do not expect a sustained move under 1900 in the current multi-week down wave.
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Update from Oscar.. who is back to bearish



This is 'something different' Mr C notes... yes... and that is EXACTLY what I've been noting for some time. This is especially the case on the bigger weekly/monthly cycles. Price action/structure IS different from anything we've seen since late 2011.

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Good wishes for Friday trading


8.56am.. Futures turn back to flat.... sp'1928... but still... there seems little reason why we won't fall another 1% at some point today.

Indeed, to hit 1904, just need a daily fall of 1.2%.... VERY viable... and that would make for a floor...before the earnings really start to flood in next week.

The bigger cycles remain key

Whilst many market watchers get lost in the minor intraday, or day to day noise, there is infinitely better clarity in the bigger weekly/monthly cycles. At no point this week did the weekly cycles turn bullish (even at the Monday sp'1977 high).


sp'weekly7a - H/S scenario

R2K, monthly3 - fib levels

Summary

We continue to hold the second red candle on the weekly 'rainbow' chart, and look headed for a hit of the important lower weekly bollinger.

Yes... the H/S scenario is just one way things could pan out.. .but still.. its a personal favourite

As for the R2K... it is completely broken.. headed for 1000.. if not the low 900s.
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Looking ahead

Import/export prices, and US Treasury budget, but who cares about those?

There are 4 fed officials due to speak... and perhaps that will cause more upset for Mr Market.

*next QE is Tuesday
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Goodnight from London

Daily Index Cycle update

US equities saw very significant declines, sp -40pts (-2.1%) @ 1928. The two leaders - Trans/R2K, settled lower by -2.4% and -2.7% respectively. Near term outlook is for a full test of the August low of sp'1904... which should equate to VIX 21/23s.


sp'daily5

R2K

Trans

Summary

*I'm tired... so.. suffice to say...... outlook remains bearish... at least to sp'1910/00 zone. The 200 MA (sp'1904) will now be a key target for bears to exit.. and many will likely be going long there.
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Closing update from Riley



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a little more later... to close the day.