Permabear Doomster

Thursday, 20 September 2018

The mighty Dow follows

US equity indexes closed broadly higher, sp +22pts (0.8%) at 2930. Dow +251pts (0.9%) to 26657. Nasdaq comp' +1.0% to 8028. The two leaders - Trans/R2K, settled u/c and +1.0% respectively. Near term outlook offers choppy weakness into the Friday quad-opex.

sp'daily5

VIX'daily3

Summary

Suffice to add... new historic highs for the sp' and dow.
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The mighty Dow follows

Some grand perspective.... Dow, monthly

A new historic high of 26697. The next key fib' is 26702 (the sp' equiv' is 3047). Upper bollinger is offering the 27200s in the near term.
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Wednesday, 19 September 2018

Higher rates are bullish

US equity indexes closed moderately mixed, sp +3pts (0.1%) at 2907. The two leaders - Trans/R2K, settled u/c and -0.4% respectively. VIX settled -8.1% to 11.75. Near term outlook offers Thursday cooling, but likely no lower than around 2895/90.

sp'daily5

VIX'daily3

Summary

US equity indexes were pretty mixed today, with the Dow moderately higher, but with tech leaning somewhat weak. No new historic highs were seen, but they are clearly coming. Volatility was naturally subdued, with the VIX settling in the 11s. S/t outlook offers moderate equity weakness on Thursday, but likely no lower than the sp'2895/90 zone.
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Higher rates are bullish

Yours truly has (vainly) tried for a few years to highlight something which the mainstream have long feared... higher interest rates/bond yields. The fed are clearly set to raise rates next week (+25bps to 2.00-2.25%), and also at the Dec'19th meeting.

Higher rates ARE inherently bullish for the US financials. Indeed, fears that the fed won't hike a third or fourth time this year, have been a drag on the financials since the early spring.

BAC, monthly

Today saw a bull flag provisionally confirmed. A push >33s is due, and that will offer the 38/40 zone, whether by year end (a stretch) or a more viable spring 2019. If I'm right, very bullish sector/main market implications into/across 2019.
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Summer has almost fully faded

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Tuesday, 18 September 2018

Tariffs, what tariffs?

US equity indexes closed moderately higher, sp +15pts (0.4%) at 2904. Nasdaq comp' +0.7% to 7956. The two leaders - Trans/R2K, both settled +0.4%. VIX settled -6.5% at 12.79. Near term outlook offers another cooling wave, that might well last into early Thursday.

sp'daily5

VIX'daily3

Summary

Those equity bulls who had been watching the early overnight futures action were naturally concerned for the Tuesday open. Yet, the Asian markets of China and Japan swung upward into their respective closes, and that helped turn the US futures marginally positive. The sp' built gains into the mid afternoon. The closing hour saw a subtle rollover, and it does threaten another cooling wave, which might stretch all the way into early Thursday.

Regardless of any cooling, today's gains were very indicative of the underlying m/t super strength. Mr Market knows the trade/tariff concerns are almost entirely inconsequential to the bigger picture. Big target of 2950/3047 isn't far away.

With equity strength, volatility naturally cooled, with the VIX settling in the 12s.
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Bonus chart: China, monthly

With a late day surge, the Shanghai comp' settled +1.8%, and that brings the net monthly decline to just -0.9%. If the SSEC can settle Sept' net higher, it'd offer a provisional sign of a m/t floor. To be decisive, I'd need to see a monthly close back above the 10MA, currently at 3053.
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