Another bullish week

US equity indexes closed on a somewhat positive note, sp +1pt at 2502. The two leaders - Trans/R2K, settled higher by 0.4% and 0.5% respectively. VIX settled -0.8% at 9.59. Near term outlook offers sig' downside next week, first soft target remains 2474/61. More broadly, the 2400/2390s... where the 200dma will be lurking in Oct'.


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VIX'daily3

Summary

First, lets be clear, it was a bullish week for the US equity market, as we saw a quartet of new historic highs in the sp'500, Dow, nasdaq comp', and nyse comp'.

As for today, US equities opened a little weak, after overnight 'war chatter' from both Trump and the DPRK. Yet price action remained very subdued, leaning upward into the close. As equity indexes are close to historic highs, market volatility is broadly subdued, with the VIX settling the week in the 9s.

Near term outlook remains unchanged. A 4-5% main market correction is due, to at least test the sp'2400 threshold, with the key 200dma just a little lower.
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London, 1.35pm EST

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Choppy weakness

US equity indexes closed fractionally mixed, sp -7pts at 2500. The two leaders - Trans/R2K, settled +0.2% and -0.1% respectively. VIX settled -1.1% at 9.67. Outlook still offers a 4-5% main market correction into October. More broadly, the bullish train is set to remain on the tracks into spring 2018.


sp'daily5

VIX'daily3

Summary

US equities opened a little weak, and saw a great deal of minor chop across the day. There was a touch of renewed weakness into the close, as the market feels distinctly tired.. especially with the fed out of the way. Cyclically, price momentum is increasingly swinging back toward the bears. At the current rate, we'll see a bearish MACD cross next Tue/Wed.

Market volatility remains broadly subdued, with the VIX spiking to 10.21, but settling in the mid 9s.

Near term outlook remains unchanged, a 4-5% correction into Oct' is due, which should equate to VIX in the upper teens, perhaps briefly testing the key 20 threshold.

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Quantitative tightening to begin

US equity indexes closed rather mixed, sp +1pt at 2508. The two leaders - Trans/R2K, settled higher by 1.5% and 0.3% respectively. VIX settled -3.9% at 9.78. Near term outlook offers initial weakness to the 2474/61 gap zone.


sp'daily5

VIX'daily3

Summary

US equities opened in minor chop mode, with the sp'500, dow, and NYSE comp' breaking notable (if fractional) new historic highs. The market saw a moderate downward swing with the Fed press release, but there was a distinct bounce into the close, especially within the Transports.

Market volatility remained broadly subdued, with the VIX notably settling in the 9s, the lowest close since late July.

Outlook into October remains unchanged. A 4-5% main market correction is due, which would take most indexes to near their respective 200dmas. That would likely equate to VIX near the key 20 threshold... if briefly.
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Quantitative tightening to begin

The Fed balance sheet reduction plan - as outlined some months ago, is set to begin in October. Things start slow at just $10bn a month, but after a year, it will total $50bn a month, which will amount to a very significant annual QT of $600bn.

Further, another rate hike is highly probable at the December 13th FOMC. Frankly, the equity/econ bulls should be very pleased with how things are proceeding.
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Autumn in London

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