In yet another reminder of their sway over the markets, the algos have brought stocks to the brink of a breakout by putting VIX at the brink of another breakdown.
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Tag: FOMC
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Charts I’m Watching: Oct 31, 2022
Futures are off about 0.50% as we approach Wednesday’s FOMC decision and a slew of important economic data.
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Fed Meeting on Deck
It’s unusual for stocks to sell off in the lead up to an FOMC meeting. Its also unusual for a bearish pattern such as a Head and Shoulders pattern to complete during those days. Yet, here we are.
As has been the case since late August, the only thing preventing a severe downturn (aside from the hope that the Fed will suddenly change course and be less hawkish) is VIX – which keeps getting smacked down every time it reaches 27-28.continued for members… (more…)
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Another Head and Shoulders Pattern
Another ugly open for markets as ES, down about 1.25%, completed its H&S Pattern we’ve been watching take shape.
More grist for the bearish mill…as though we needed any more.
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Charts I’m Watching: Sep 15, 2022
After that vicious selloff, the market is now in wait and see mode – levitated by OPEX this Friday and next week’s FOMC meeting.
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Pretty Soon, You’re Talking Real Money
Apparently, investors aren’t quite as sanguine about inflation as it seemed. After slightly overshooting our upside target from February, SPX plunged 4.32% – about $1.5 trillion in market cap. Trillion-and-a-half here, trillion-and-a-half there, pretty soon you’re talking real money. It was the worst day in the markets since March 2020 and one of the worst on record.
Yet, the talking heads and financial press were all rainbows and unicorns leading up to the CPI print. The big question, of course, is “what happens next?”continued for members… (more…)
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Inflation Rises
August CPI came in hot, rising 0.1% in August instead of the consensus 0.1% decline. Core was even worse: 0.6% versus 0.3% consensus. The annual print also disappointed, coming in at 8.3% versus expectations of 8.0% or less.
Having slightly overshot our 4153 target overnight, ES is now reversing sharply.
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Charts I’m Watching: Sep 12, 2022
Futures are up modestly on light volume algo action in advance of tomorrow’s CPI data.
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Backtest Complete
Breakouts from well-established falling channels are usually followed by backtests of that channel. This is how bulls put all that nasty bearishness behind them, freeing stocks for another leg up.
Except, it doesn’t always turn out that way. Sure, ES nailed our backtest target. But will it follow through with a respectable bounce?continued for members... (more…)
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Powell Lays it on the Line
Markets finally got the message. Or, maybe Powell finally put it plainly enough: there will be more pain before the Fed eases.
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