One Step Forward, Two Steps Back

While January’s retail sales saw a modest rebound (+0.2% MoM), December’s were revised downward from -1.2% to -1.6%. Futures bumped slightly higher, presumably because a slowing economy protects the market from Fed tightening.  In reality, it was driven by continuing VIX algo-signalling. With key DJIA component Boeing off sharply in the pre-market, today could be … continue reading →

Unspinnable

An extremely disappointing payrolls report put February new hires at 20K.  I had to look twice, certain that a digit had been left out.To make matters worse, hourly earnings spiked 3.4% YoY, far in excess of what all the Goldilocks models suggested. It should be entertaining to see how Kudlow et al. spin this one. … continue reading →

If at First You Don’t Succeed…

Yesterday’s setup for the e-minis looked pretty straightforward: a drop through the 200-day moving average and backtest of the 2.24 Fibonacci extension at 2729. Futures had already dropped through the 200-DMA and were heading south when the dismal retail sales data dropped. I hedged my bet, redrawing our daily downside target to include the 10-DMA … continue reading →

Backtest Accomplished

Members, remember to request access to @pebbletrades if you’d like intraday notices of important updates.  Only about 20% of you are currently signed up, and I’d like to use it more often to signal when important target tags or changes to a forecast occur. If your identity isn’t discernible from your Twitter handle, drop us … continue reading →

Investing for Dummies

I use scores of chart patterns, Fibonacci grids, technical indicators and proprietary models in my daily attempts to forecast various markets.  Some are fairly complex, multivariate models that involve a half-dozen inputs.  Others are quite simple. One of my favorite simple indicators is the well-known 10-day/20-day moving average cross. It maintains that when the SMA10 … continue reading →

FOMC: What Elephant?

Over the last 20 years, we’ve seen two yield curve (2s10s) inversions: essentially all of 2000 and Dec 2005-May 2007.  The inversions themselves posed no issues for equity markets.  It was the dramatic unwinding of those inversions that produced crashes.Eight months ago, we almost had another.  2s10s had fallen to a trend line connecting those … continue reading →

The Devil’s Playground

Catch this news flash yesterday?  Trump, ironically at a White House meeting with the National Council for the American Worker: You’re gonna see on China, today, right after close of business…we’ll be announcing something, uh, and it will be a lot of money coming into the coffers of the United States of America, a lot … continue reading →

It’s a Wonderful Market

SPX and ES had no trouble reaching our initial downside targets — a backtest of their January highs.  We wondered, however, whether the SMA20s, loitering just below, might come into play. Sure enough, ES tagged its SMA20 with ease.  But, emini traders strongly resisted a drop through the SMA20 – bad mojo, don’t you know. … continue reading →

Crypto Carnage

As the currency turmoil continues, it’s interesting to note that cryptocurrencies are having a worse go of it than EMs. Meanwhile, futures dipped enough overnight to finally backtest the SMA10.  They’ve since rebounded enough to backtest the broken red channel.  It remains to be seen whether SPX will join in and backtest its SMA10 and … continue reading →

A Backtest or More?

Today should shape up as a battle between holding a much-cherished round number (SPX 2900) and backtesting solid support (the January highs.) The futures are off about 5, with yesterday’s downside target of 2878.50-2881.95 still looking good — if SPX will relinquish 2900. Much will depend on the yen, which is strengthening in the midst … continue reading →