Pre-Market Brief

Good morning. Futures are moderately lower, sp -12pts, we're set to open at a new cycle low of 1977. With a very weak USD, -0.9%, the metals are strongly higher, Gold +$24. Oil remains in collapse mode, -2.0%... having reached the $53s.


sp'daily5

Summary

Having broken yesterday's low.. the next level is clearly the 200dma, along with the 50% fib retrace around 1950. That is of course a full 2% below yesterday's close.

Considering the current mood in early market... it now looks like we'll get there.
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Notable early strength: GDX +4.4%... naturally.. a result of the strong metal gains. Will be interesting to see how they are trading after the FOMC meeting.
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Video update from Mr Permabull


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Regardless of today, the window for the bears IS still due to close. If we do reach 1950 by tomorrow... I will indeed be surprised, but we'll still be due to rally from there.

Have an 'entertaining' Tuesday.
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Update on Russia...

SEE here...  @ bloomberg

Incredible.. the Russian market was trading at 578 earlier.. that was almost a fall of -20% fall. We've almost tested secondary support of 550s.
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8.27am... indexes recovering,, sp -4pts....  1985... Hmm

Meanwhile.... Russia -13% @ 625.... 75pts (12%) until next target.

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9.32am.. well, there goes sp'1980... next level.. 1950...

VIX +8% in the 22s....


9.50am.. opening reversal underway!

The equity bear window is closing

It was a pretty interesting day in market land, with a major morning fail for the bull maniacs.. the sp'500 swinging from 2018 to 1982 by midday. Yet... with the FOMC announcement this Wednesday (2pm), the window for the equity bears is soon to close.


sp'weekly6 - with fibs

Summary

So.. the second consecutive red candle on the weekly 'rainbow' chart.. with a new cycle low of sp'1982. Overall though, once we get the fed out of the way, I'll be looking for renewed upside into the quad-opex weekly close, and all the way into January.


Russia remains in crash mode

With oil prices continuing to fall, the Russian market lost another -9.4% today... now at 725.

Russia, monthly

Next support is not until 550... that is another 175pts (25%) lower!

*as for the interest rate rise from 10.5% to 17%... I think I'll leave others to comment on that huge issue.. at least for today.
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Looking ahead

Tuesday will see housing starts and PMI manu' data.
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Still short the miners

I've been keeping it 'light' across the last few weeks. No index trades (not least on the short side!)... no VIX... not much of anything. However, I've been holding onto a small GDX (option put) short position.. which saw a powerful drop today...

GDX, daily

I remain seeking broad weakness for the precious metals (Gold $1100/1080 is just about viable by year end)... and that should naturally result in continued weakness in the mining stocks.

Early next year I'll be looking to pick up a number of key long term positions... but more on that.. as we get closer to year end.

Goodnight from London

Daily Index Cycle update

US equities opened higher (intra high sp'2018), but saw a strong morning swing lower, with a new cycle low of sp'1982, and settling -12pts @ 1989. The two leaders - Trans/R2K, settled +0.2% and -1.0% respectively. Near term outlook is for a key turn around this Wednesday's FOMC.


sp'daily5

R2K

Trans

Summary

So.. the big sp'2000 threshold failed to hold, along with a daily close decisively under the 50dma. Understandably, many equity bears will be looking for a hit of the 200dma (near the 50% fib retrace of 2050) in the coming days.


Where now?

As has been noted since last week, the 'FOMC clock is ticking'. On no outlook can I see sustained equity downside after this Wednesday's FOMC announcement.

It is notable that the 'old leader' did manage a net daily gain today, although that was no doubt aided by the continuing collapse in oil prices.
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Closing update from Riley


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a little more later...