Midweek Market Update – Sep 17th

The market really did gyrate wildly today with the FOMC announcement. But the minutes and FED’s statement didn’t offer anything new to ponder. The tapering of QE continues and is nearing an end, while language regarding interest rates essentially was unchanged.

Why that news warranted such movements or why it would be viewed as any more bullish is beyond me. But the point is really not what the FED is doing anymore; we have a firm understanding of that landscape now. This market continues to find any and every reason to put a bullish spin on what is fast becoming an unsustainable bull market advance. Continue reading

The End(s) is Near!
Falling gold prices

In closing, I circle back to a recurring theme…that the evidence currently supports both bullish and bearish views. With Gold still in a well-established triangle pattern, the uncertainty is not surprising. This week, however, the bear has begun to stir, with Gold pushing lower and taking out a key Cycle pivot. The current set up is undeniably negative, and odds are that we are still several weeks from an ICL. So the only prudent expectation here is to the downside. The downside case is supported by the current trend, and a test of the last Yearly Cycle Low (June 2013) at $1,179 is likely coming. That is the last line of support for Gold and potentially where the bulls will mount an attack. Continue reading

Midweek Market Update – Sep 10th

At this point, the dollar is extremely overbought. From a timing standpoint, it is well overdue for a Daily and Investor Cycle top. Sentiment and COT are at extremes too, so the “evidence” calls for a fall over many weeks. I know that doesn’t seem likely here, especially when one looks at the massive spike on the chart below. Continue reading

Late to the Party

The Euro is now on a 22 week losing streak and over 40 weeks have elapsed since the last ICL. An asset under such extreme pressure can remain grossly oversold for long periods of time, but in this case, I feel that this sell-off is now well overdue for a counter trend bounce. But I’m afraid the ECB has tipped their hand and further easing is only going to further pressure the Euro. Continue reading

Midweek Market Update – Sep 3rd
crude go

A couple of roller coaster sessions within Crude Oil to start the week, but in the end, I’m sure my weekend call for a new Daily and Investor Cycle is correct. Yesterday’s $2 drop was ominous, but with today’s recovery, yesterday’s move looks more like a whipsaw of new positions than anything else. If Crude Oil can better Monday’s high of $96, then this will be a confirmed new Cycle. Continue reading

Weekend Report – Aug 30th/31st

Not even the threat of all-out war in the Ukraine has an impact on the equity markets these days. The market has tunnel vision now, as it heads ever steeper towards that final peak. And now having taken out the psychologically important 2,000 level, there is nothing but thin air and uncharted territory directly ahead for the markets. Remember, putting valuations and future earnings aside, this market is now likely to continue higher until “the music stops”. Continue reading

Midweek Market Update – Aug 27th

Hope you’re summer (for most) is going well. I have a slightly lighter update tonight, as I’m on the road this week with limited time or access to markets. There have been very few changes within all 5 of the …

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The Final Countdown
mini bubble

Despite equity markets making all-time highs, inflows into sovereign bonds are also at extreme levels. This is a bond rally of massive proportions, although it remains a side-show to the S&P. Any asset that rallies as long as Bonds have without attracting broad attention is one to keep an eye on. It’s amazing that even after a powerful 7 month rally, sentiment is barely above neutral.

To me, this highlights that the smart-money is buying up bonds, knowing full well that the equity move is unsustainable. An ICL is way past due, but the current trend is telling us that the eventual ICL will be bought; Bonds remain in a bull market. Continue reading

Midweek Market Update – FED Speak – Aug 20th
Fed speak

My “bounce-back” call to the 1,970 level has been fulfilled and within my expected aggressive timeframe. No doubt, this has been a bullish bounce back and it looks a lot like the start of yet another Investor Cycle. But it also has a “desperate” feel to it, so a turn lower from here remains a possibility and within the yearly Cycle Low scenario. Either way, in the short term, I expect a drop here in both cases, how it responds from there will show the path forward. Continue reading

Hanging On

Is the world economy finally showing signs of economic weakness? That’s my takeaway from a number of reports this week. Here in the US, the reliable retail sales number was flat, meaning no growth in sales. And this weakness was confirmed by sales numbers from Walmart. On the manufacturing end, the NY index fell to 14.7, well below the 20 reading that was expected. Continue reading