Market Snapshot Thursday 3 March 2016

Adding strength to our "SPX 2000" theme is the VIX resuming its teen status as the risk averse are dissuaded from insuring falling stock prices.



VIX Daily

The questions now become, will buyers overwhelm sellers at SPX 2000 and 2060, push price into new highs, above 2120, and resume a broad market uptrend?

SPX Daily



Available evidence suggests "yes" assuming risk assets can make peace with their common foes; a stronger US dollar and rising treasury yields.

DXY Daily

US 10 Year (Yield)

Bulls, with the obstacles of SPX 2000 and 2060 to overcome, are not out of the woods yet and can expect a fight from institutions will millions of dollars bet on bear a market.

Happy trading.

Markets 29 Feb - 4 March 2016

We ended last week with optimism for a run at SPX 2000 where we were looking for an early Friday bounce at 1940.

SPX 60M

The issue now is less whether we can participate in the intermediate uptrend to SPX 2000, but whether the current uptrend holds at a level in the vicinity or fails and resumes the broader market and economic downtrend.

SPX 60M

The most compelling argument for a rally and resumption of the intermediate uptrend, if 1930 fails, is SPX 1910 (above chart) as price moving into the 1800s will threaten the upward drive.

Happy trading. 

Markets 26 Feb 16

As the intermediate uptrend continues the broader market has cleared the lane to SPX 2000 where buyers and seller will battle it out for overall trend domination. I am looking sell SPX correlated products at SPX 2000 but, until then, adding to upside entries.

SPX Daily

Expect a challenge to the overall downtrend if SPX 2000 turns out not to be an ambush for buyers. Price closing in on SPX 2130 will hint a resumption of the broad market uptrend.

Happy trading.

Market followup 24 Feb 2016

Although nothing has happened to change the overall downtrend of markets, today provided a massive upside trading opportunity for those with the knowledge to catch it.

S&P Futures 5m 

Nailing moves like this, in the face of overwhelming negative market commentary, truly distinguishes the pros from the majority of industry noise makers.

Midweek Snapshot 24 Feb 2016

So far price action this week has been a lesson for buyers on why not to load up into resistance levels in down markets.

SPX 60M

Although, on Monday, I was looking for a breakout and daily close above 1950 on the SPX I was also very clear no buy orders should be placed until then, upon which a confirmation entry should be used to enter long.

"The question is less 'will price break above 1950' but 'will price allow a safe confirmation entry to buy between today's open and SPX 2000?" -22 Feb 2016

Monday and Tuesday were reminders of how we cannot ignore the weakness of markets which will continue, I expect, unless asset prices decouple from the economy and rally on the desperation of Fed monetary policy.

Markets 22 - 26 Feb 2016

Those with a strong sell bias, who didn't get slapped around hard enough by last week's price action, are waking up this pre-market Monday with some issues to face.

SPX Daily

Considering market confidence buying into Friday's close (last candle on the right) the question, as price presents itself on the above chart, becomes less 'will price break above 1950' but 'will price allow a safe confirmation entry to buy between today's open and SPX 2000?'

VIX Daily

Adding to the stress level of undaunted shorts is the VIX where we see Friday's price slamming into daily support with no buyers, as puts deleverage from the scene, and approach the Fed's "whew!" VIX numbers: teens.

DXY Daily

 What upward markets have yet to reconcile is continued USD strength. Another topic for a future article.

Happy trading.

Market follow up Wednesday, February 17, 2016

Two points of yesterday's thesis survived today's price action. The USD hung in at the 97.00 - 96.00 level while oil rallied but stopped short of penetrating its first daily resistance level.

DXY Daily Chart

Oil Daily Chart

SPX Daily Chart

Buyers, as you can see (above) from virtually zero sellers in three strait days of trading, have been extremely sure of themselves. But indexes have to meet a much higher standard, compared to other products, before we can stop selling rallies and start buying dips. In the case of  SPX that "standard" is a weekly close above 2130; a new record high and resumption of the uptrend.

Considering weak economic fundamentals I think such new highs would have to involve QE, another zero interest rate policy, or both. In other words, I don't see how, at peak supply, something like OPEC claiming to curb production is going to push all asset classes into new highs. What are we, a single resource global economy now?

Question or comment below.

Happy trading.