A mixed day in equity land

US equity indexes closed moderately mixed, sp +6pts @ 2077 (intra low 2050). The two leaders - Trans/R2K, settled lower by -0.3% and -0.1% respectively. VIX cooled -3.8% @ 19.37. Near term outlook offers the sp'2090s for quad-opex, before renewed downside to test the critical 2025 low within 3-6 trading days. If 2025 fails to hold, - as seems probable, then 1950/20.


sp'daily5

VIX'daily3

Summary

So.. a net daily gain for the sp'500.. but broadly, price action remains pretty bearish.

Even quad-opex upside to the 2090s won't negate the fact that we've seen a lower low.. and lower high this week.. as fully confirmed in a VIX that has broken into the 20s.

Price action back above the sp'2100 threshold looks highly unlikely.. as the bigger weekly cycles will soon see a bearish cross.


--
USD ahead of BREXIT

USD, weekly

Without question, the looming BREXIT vote will be a key variable that will shape the rest of the summer... and for those in the UK/EU... years. A break above the DXY 100 threshold remains due, and that will have massive implications for just about everything.

Goodnight from London

Another day for the bears

US equity indexes closed moderately mixed, sp -3pts @ 2071 (intra high 2085). The two leaders - Trans/R2K, both settled higher by 0.1%. VIX cooled by -1.8% @ 20.14 (intra low 18.63). Near term outlook offers further bounce upside to the sp'2090/2100 zone, before renewed downside.


sp'daily5

VIX'daily3

Summary

A fifth consecutive net daily decline for the sp'500... the most bearish run since February.

Despite some late day weakness... further upside to the sp'2090s.. perhaps even the 2100 threshold looks viable into the quad-opex weekly close, before things get real interesting next week.

*I checked the weather forecast for next Thursday - the UK election day. Its currently set to be warm and sunny... and by definition, that does favour a higher turnout. Some could argue that favours a greater number of conservative 'remain' voters will make the effort to vote. However, underlying sentiment continues to lean toward a 'LEAVE' vote.

--
An update on the bigger picture...

sp'weekly1b

We have a rather secure mid term cycle high of sp'2120. Equity bears can re-short with a very tight short-stop. The risk/reward into next week is exceptionally good, and I'll likely take at least one or two speculative positions, based on the notion that we'll at least test the sp'2025 low. If that fails to hold, things should spiral to 1950/20 within days.. if not hours.

Goodnight from London

A fourth day for the bears

Despite a closing hour rally, US equity indexes closed broadly lower for a fourth consecutive day, sp -3pts @ 2075 (intra low 2064). The two leaders - Trans/R2K, settled lower by -1.4% and -0.2% respectively. VIX cooled by -2.2% to 20.50. The FOMC offers a viable excuse for a brief and unsustainable bounce, with the sp'1900s probable by end month.


sp'daily5

VIX'daily3

Summary

Another rather interesting day in market land, with a new cycle low of 2064 (with VIX 22.16) and a (not surprising) closing hour rally.

The Wed' FOMC will be a prime excuse for a Wednesday net gain, with further churn/upside across Thurs/Friday. With quad-opex this Friday, that further favours the bulls... after the recent cooling.

More broadly though... having broken a fair few initial supports, the outlook is increasingly bearish, as the bigger weekly cycles continue to turn toward the bears.

sp'weekly1b

A divergent lower MACD cycle high. At the current rate, we'll see a bearish MACD cross before end month, and in theory, that will offer first opportunity of some very powerful downside action, with VIX exploding into the 30/40s.

Of course, if the UK vote to remain... things will be rather different. The current polls increasing suggest we'll see a BREXIT.. which should rattle world capital markets.
--

Goodnight from London