Daily Wrap

US equities settled broadly higher for a second consecutive day, sp +14pts @ 2090 (intra high 2094). The two leaders - Trans/R2K, settled higher by 0.8% and 0.5% respectively. VIX remained in cooling mode, -3.6% @ 13.90. Near term outlook is extremely borderline, as the sp'2100 threshold remains major resistance.


sp'daily5

VIX'daily3

Summary

So, a second day of equity gains, with the VIX continuing to cool from last week's high of 17.65.

With a three day holiday weekend approaching, price action will be leaning on the quieter side, and that will favour the equity bulls.

A move back above the key VIX 20 threshold looks inevitable in June, but then, are we only looking at a brief foray to the low/mid 20s, before renewed equity upside (to new historic highs) across the summer?

--

Market chatter from the Schiff




--
Three days left

With next Monday CLOSED in the US market for Memorial day, my attention is increasingly focused on how the month will settle.

sp'monthly2 - boll/Keltner

I highlight the above monthly chart as I see some people posting overly bearish downside targets for June.

As I often like to say... first things first.

First, the equity bears need to break last week's low of sp'2025, then the giant psy' level of 2K, and then show some downside power to the low 1900s.

Indeed, across June, the lower monthly bollinger will be around 1930/20s. Any initial break <1900 looks overly difficult.

The lower Keltner band will be offering first viable chance of the low 1800s in July.

...and of course, any break above sp'2134, with Dow >18351, would negate ALL bearish targets, and open up an entirely different outlook, the far more scary inflationary scenario.

Goodnight from London

Daily Wrap

US equity indexes closed significantly higher, sp +28pts @ 2076, with the two leaders - Trans/R2K, higher by 0.6% and 2.1% respectively. The VIX was naturally ground lower across the day, settling -8.8% @ 14.42. The mainstream mood is back to almost maximum complacency, as rate hikes and a BREXIT vote are no longer seen as a problem.


sp'daily5

VIX'daily3

Summary

It was a pretty damn bizarre day in market land, with even some of the cheerleaders on clown finance TV recognising that the degree of gains were not remotely justified.

It is understandable that some of the bull maniacs are now seriously looking for a break back into the sp'2100s, broadly higher across the summer, and indeed... the rest of 2016.


Yet... has anything really changed?

Today's gains do nothing, as the market remains stuck in a relatively narrow trading range. Aside from a few brief forays >2100, and the two down waves to the 1800s, the market has been broadly stuck in a 4-5% range for an entire year.

Trading ranges won't last forever... and whichever side we do break, will likely determine the market direction for many months.. if not years.


--
The bare bones view...

sp'monthly3c

We've been broadly stuck for an entire year (1.5yrs for the 'old leader' - Transports). The obvious break levels are >2134 and <1810.

Very few in the mainstream now consider the latter as remotely possible this year, and its that degree of near total complacency that should actually concern the bulls right now.

*I realise a fair few of the wave counters out there are calling the move from 2134-1810, a giant 4, with a fifth now underway. But hey... I'm not much one for counting this nonsense.
--


So.. what about the Fed/rates... and the BREXIT vote?

I'm still of the view the Fed will not raise rates ahead of the BREXIT vote, which many realise would be a very valid excuse for the market to at least cool (if briefly) back under sp'2K.

As for how the UK populace will vote (June 23rd), the outcome is likely to be pretty close - much like the Scottish independence vote in 2014. I'm still leaning on the conservative side.. which would see a 'STAY' outcome. Were that the case.. the market would rally.. at least initially.

--
Goodnight from London

Daily Wrap

US equities closed a little weak, sp -4pts @ 2048. The two leaders – Trans/R2K, settled lower by -0.4% and -0.1% respectively. VIX managed a minor gain of 4.1% @ 15.82. Near term outlook offers a break of the recent sp’2025 low, and that will re-open the door to a valid H/S target of 1970/60s.

sp'daily5b

VIX, daily3

Summary

It was not exactly the most exciting start to a week, as the market saw a great deal of price chop... but was distinctly leaning weak into the close.

VIX is still broadly subdued. A move to the key 20 threshold looks due... the bigger weekly chart is offering the 24/27 zone into early June.. although I realise most would be dismissive of that kind of powerful (if brief) spike.
--


Day'1.. again

Today sure was different for yours truly. After four years here, it was kinda bizarre not to be posting via blogger/google. I'm not great with change, and my mind has been spinning just trying to figure out a type of DTP software.

If you have liked my work since 2012, then subscribe to me - see HERE, where I now reside each and every trading day.

Goodnight from London