We shall call it...

US equity indexes closed broadly higher, sp +26pts (0.9%) at 2919. Nasdaq comp' +1.0%. Dow +0.7%. The Transports settled +1.2%. Near term outlook offers another swing lower ahead of the weekend.

sp'daily5

VIX'daily3

Summary

US equities opened broadly higher on yet another China trade related headline. Whilst the gains were a little shaky, the market did manage to claw to 2929 in the closing hour... only to see yet another trade headline knock the market to settle at 2919.

It wouldn't be a normal trading day without...

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Volatility was in melt mode, with the VIX settling -8.1% at 18.64. S/t outlook offers another significant wave lower in equities to challenge last week's spike floor of sp'2855. If the VIX settles the week above the key 20 threshold, I would look for the 2810/2790 zone with VIX printing >30 next Mon/Tuesday.
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We shall call it...

As the fed are set to spin up the printers again, what do we call it?

Powell is repeatedly saying "This is not QE". By definition, that merits as outright crazy talk. An increase in the balance sheet - literally printing money out of nothing, and then buying something (whether T-bonds or whatever) is QE.

The FOMC of Oct'30th will provide rate cut'3, but also renewed QE of around $15bn a month. It appears that will be used to buy US Govt' bonds.

After some thought... I will call it... QE4 Phase'1

We know where this is headed, right?

Phase'1 $15bn
Phase'2 $40/50bn (by end 2020)
Phase'3 $90/100bn (2021/22)

QE4 will be without end, and in addition to US Govt' T-bonds, we can expect eventual purchases of anything and everything, including corp' bonds, stock/bond ETFs, student debt, property (both business and residential), and infrastructure bonds. The only thing that isn't currently on the menu is the direct purchase of people. 

To quote Dr Strange... "... we're in the Endgame now", although perhaps the following is more appropriate...



Yours, tempted to call it... 'mini QE'
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A chilly autumn day in the capital of geo-political chaos

Full moon is Sunday Oct'13th

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Extra charts in AH (usually around 5pm EDT) @ https://twitter.com/permabear_uk

Goodnight from London
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Renewed threats of QE

US equity indexes closed very significantly lower, sp -45pts (1.6%) at 2893. Nasdaq comp' -1.7%.  Dow -1.2%. The Transports settled -1.9%.

sp'daily5

VIX'daily3

Summary

US equities opened broadly lower on renewed US/China trade concerns. The SPX spiraled down to 2896, with a bounce into the early afternoon.

Powell appeared....

... and whilst he repeatedly said 'This is not QE", calling it just 'adjusting the balance sheet for reserve management purposes', today was effectively the first outright threat of renewed QE.

At the FOMC of Oct'30th, in addition to rate cut'3, we can now also expect the printers to be spun up, with monthly QE of around $15bn. I guess it should be called QE-lite, rather than QE4.

The Twitter legion responded overnight...

In terms of rates...

A mere 7% believe rates won't be cut any further this year. Yours truly is expecting TWO rate cuts.

Further...

A US/China trade deal does indeed appear very unlikely before year end. Even if one is announced, most accept it would be a poor deal of no real consequence.

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Volatility picked up, with the VIX settling +13.5% at 20.28. S/t outlook offers a challenge of the sp'2855 low. Alarm bells if the VIX settles the week above the key 20 threshold.
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Autumnal sunset

Full moon is Sunday Oct'13th

--
Extra charts in AH (usually around 5pm EDT) @ https://twitter.com/permabear_uk

Goodnight from London
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Starting choppy

US equity indexes closed on a weak note, sp -13pts (0.4%) at 2938. Nasdaq comp' -0.3%. Dow -0.4%. The Transports settled -0.2%.

sp'daily5

VIX'daily3

Summary

US equities opened on a slightly weak note, with an early low of sp'2935, but then clawing back upward to turn positive to 2959, a considerable 104pts above the Thursday low.

Whilst the US President was busy with other things, Powell took an unusual indirect swipe back...

"The... central bank must be absolutely free from the dangers of control by politics..." - Powell. We can be sure Trump will be taking ever more fierce swipes at the fed, with any weak econ-data, bad earnings, or any degree of equity cooling.

The US President appeared in the late afternoon, for the signing of a US/Japan trade agreement.

"... we have no inflation, if anything, its going below the number, so therefore we're entitled to an interest rate cut, I hope the fed does that... a substantial one". As things are, we're set for rate cuts 3 and 4 at the FOMCs of Oct'30th and Dec'11th.

The late afternoon saw renewed equity weakness, with the SPX settling moderately lower at 2938. Volatility churned the 18/16s, settling +4.8% at 17.86. S/t outlook offers equity cooling to at least sp'2918/11, with VIX 18/19s.
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A new era

Equity trades are now at zero cost. That just leave options trades, although at least the 'base commission' has been removed. I have to imagine we'll see the average per contract commission fall to 50cents or lower in 2020.

Whilst of the mainstream brokers have been lowering commissions across the past few decades, Robinhood has been a primary factor in helping push commissions from low to zero. As things are, Robinhood are due to IPO before year end.
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Extra charts in AH (usually around 5pm EDT) @ https://twitter.com/permabear_uk

Goodnight from London
--
If you value my work, subscribe to my intraday service. 
For details and the latest offers, see: Permabeardoomster.com