Fear and Greed

ES is reaching our next downside target right on schedule.Note that if ES hadn’t spurted past its February highs in late August, falling to our 100-DMA target would have involved a fairly shallow drop of 5.5% and would have preserved the rising white channel. Instead, we have a 10.8% loss so far and face much … continue reading →

Charts I’m Watching: Sep 15, 2020

The great thing about channels is that they tell you quite precisely when a trend change has occurred. The falling white channel seen on ES was tested just prior to the open yesterday. A simple smackdown on VIX and it was off to the races. As we noted at the time, ES’ 10-DMA had dropped … continue reading →

Breakout or Headfake?

Today’s post could be an extension of yesterdays, with more beneficiaries of the shutdown such as Target and Lowes reporting big beats.  Winners and losers. Curiously, ES failed to make a new high yesterday even thoughy SPX briefly rose above its February highs. You’ve always had to worry about predatory traders and specialists trying to … continue reading →

New Highs Inevitable?

The algos are still threatening new all-time highs, this time egged on by the “wonderful” news that only 963,000 new unemployment claims were filed last week and only 15.5 million Americans are currently drawing unemployment. It didn’t hurt that VIX made several sudden plunges in the past hour and that the USDJPY is threatening to … continue reading →

PPI’s Big Beat

PPI was expected to tick 0.3% (0.1% core) higher in July. Instead, headline PPI soared 0.6% and core popped a stunning 0.5% – the highest since October 2018. The impact on stocks has been muted so far, as the market is still giddy over the potential release of what is essentially a Phase 1 vaccine … continue reading →

Thinking About…a Correction

Will the addition of another “thinking about” keep stocks aloft until the next FOMC meeting?  Futures aren’t looking so hot, perhaps because WTI has now joined RBOB in breaking trend, 10Y yields have gapped lower, and VIX broke out of its falling wedge. The algos are not happy. continued for members… … continue reading →

Currencies: A Turning Point

Lots going on this morning, with currencies joining VIX in leading the equity circus. EURUSD smashed its March highs and is closing in on one of two levels of overhead resistance as DXY tests an important channel bottom. The next moves for each will have important implications for the economy and for algo-driven equities. ES … continue reading →

Shades of 2015

SPX reached our Fibonacci .886 retracement target yesterday. It’s a level I never imagined seeing after stocks reached important support back on March 23. But, then, I never imagined $5 trillion in liquidity  – equal to the nation’s Q2 economic output according to the Atlanta Fed – being pumped into the economy in the second … continue reading →

Charts I’m Watching: Jun 29, 2020

Futures are up modestly this morning as we glide into the quarter end on a holiday-shortened, low-volume week.  VIX’s triangle perfectly illustrates the technical picture: attempts to break out have been beaten back, while threats to break down have routinely been rebuffed. It’s exactly what one would expect when the goal is to maintain positive … continue reading →

Oh Yeah, the China Trade Deal…

When does “it’s over” mean it’s not over?  When the market plunges 65 points, of course. The 2% hiccup came when Fox’s Martha MacCallum asked Trump advisor Peter Navarro whether John Bolton’s claims that Trump delayed imposing sanctions on China over its policy of interning Uighur Muslims would jeopardize the China trade deal. Navarro, fresh … continue reading →