UPCOMING (MAJOR) U.S. ECONOMIC EVENTS...
* Wed. Oct. 20 @ 2:00 pm ET - Beige Book Report
* Tues. Oct. 26 @ 10:00 am ET - CB Consumer Confidence
* Fri. Oct. 29 @ 8:30 am ET - Core PCE Price Index m/m Data
* Wed. Nov. 3 @ 2:00 pm ET - FOMC Announcement + FOMC Forecasts and @ 2:30 pm ET - Fed Chair Press Conference
* Fri. Nov. 5 @ 8:30 am ET - Employment Data
* Tues. Nov. 9 @ 8:30 am ET - PPI m/m & Core PPI m/m Data
* Wed. Nov. 10 @ 8:30 am ET - CPI m/m & Core CPI m/m Data
* Fri. Nov. 12 @ 10:00 am ET - Prelim. UoM Consumer Sentiment
* Fri. Nov. 12 @ 10:00 am ET - Prelim. UoM Inflation Expectations
* Tues. Nov. 16 @ 8:30 am ET - Retail Sales & Core Retail Sales Data
* Wed. Nov. 24 @ 2:00 pm ET - FOMC Meeting Minutes
*** CLICK HERE for link to Economic Calendars for all upcoming events.
Sunday, July 30, 2017
My WAG -- IF price can rally and hold above 55.00, we could see a retest of 65.00 in short order...a pop and hold above 50.00 is, however, the first order of the day -- see the Monthly chart below of Crude Oil.
My gut currently favours the long side...of course, I'm not always right, so do your own due diligence.
* UPDATE August 11th:
In view of President Trump's proffered comments today regarding Venezuela, Oil Bears BEWARE!
Tuesday, July 18, 2017
It looks like everyone is tired and unable to do what they were elected to do.
If everyone's tired, how will this failure affect the progress of any other political items that President Trump has on his agenda?
And how will this affect equity markets for the remainder of the year? The SPX has looked pretty tired since March.
It's anyone's guess, I'd say...
Notwithstanding what I wrote on July 16th which describes new "BUY" signals in the SPX and the World Market Index, the last chart posted in that article (see Monthly chart of SPX below) shows that price is currently up against major resistance, formed by a long-term Fibonacci fanline (40%) and dating back to 1990, and is approaching an external Fibonacci retracement level of 200% at 2485 (taken from the highs of 2007 to the lows of 2009).
So, in the shorter term, we could see a "bull trap" occur prior to a decline in equity markets.
Combine this with today's announced failure of healthcare reform and the Fed's gradual removal of the low-rate punch bowl, and you can take your pick as to short-term market direction -- up, down, or sideways -- mixed signals in equity markets.
* P.S. July 24th...
However, inasmuch as the natural tendency of markets, in general, is to go up, I'd give slightly more weight to a continued advancement to the upside in today's politically uncertain environment...but, at a slower pace and with, perhaps, a bit more volatility than has been experienced, of late.
In this regard, keep a close watch on the SPX:VIX ratio, as a drop and hold below 250 will see volatility increase, and a drop and hold below 200 could see a panic selloff ensue in equities.
Monday, July 17, 2017
We'll see if today's selloff continues, in light of my comments of June 29th, and whether it eventually negatively affects other world markets.
Sunday, July 16, 2017
Price punched through 1900 (which will now need to hold as major support), the RSI has broken its latest downtrend and is back above 50, and there are new bullish crossovers on the MACD and PMO indicators, as shown on the following Daily chart.
While the SPX has broken above near-term resistance of 2450 and closed at another all-time high, it's a nano-breath away from also triggering a new "BUY" signal.
If price remains above 2450, if the RSI remains above 50, if the recent bullish crossover holds on the MACD, and if we get a bullish crossover on the PMO (imminent), we'll see this trigger erupt, as shown on the Daily chart below.
The SPX:VIX ratio has also broken above near-term resistance of 250 and closed at a new all-time high, as shown on the Daily ratio chart below.
Inasmuch as the RSI has broken its downtrend and is above 50, and bullish crossovers have formed on the MACD and PMO indicators, this ratio is confirming that a new "BUY" signal has triggered on the SPX. However, to see this through to fruition, we'll need to see price remain above 250 and volatility remain at all-time lows.
The following 1-Year Daily chartgrid of the 9 Major Sectors shows that Industrials and Materials are leading the pack, followed closely by Technology, Health Care, Cyclicals and Financials.
Utilities and Consumer Staples have slumped the past couple of months and Energy has been in a major downtrend all year. I'd keep a close watch on these three Sectors to see if buyers begin to dip their toes into these anytime soon.
If so, and, if the other six Sectors can hold their own, we will, no doubt, see more new records set in the SPX, with buying continuing in the World Market Index (the Year-to-date graph below shows that 8 of the 9 Sectors have decent to healthy gains, so far this year, while Energy is at -12.05%).
* P.S. July 16th
If we get a bull run like we had in the 1990's, then the SPX could reach 2700 by the 2020 Presidential election, as forecast in my post of November 26, 2016.
A level of 2700 represents approximately the next major long-term Fibonacci extension level (1.618%), as shown on the following Monthly chart of the SPX.
However, price is currently up against major resistance, formed by a long-term Fibonacci fanline (40%) and dating back to 1990, as shown on the Monthly chart of SPX below, and is approaching an external Fibonacci retracement level of 200% at 2485 (taken from the highs of 2007 to the lows of 2009).
So, in the shorter term, we could see a "bull trap" occur prior to a decline in equity markets...keep a close watch on the above-referenced Major Sectors for further signals and any evidence of weakening.
Tuesday, July 11, 2017
The Daily ratio chart below of XLF:SPX also shows that price is up against major short-term price resistance.
The year-to-date percentages-gained graph below shows that XLF has been holding its own, so far this year, compared with the other 8 Major Sectors.
We'll see if 25.00 can be overcome and held (to potentially propel it to 30.00, or higher), or whether traders get cold feet on this ETF in the near term.
Wednesday, July 05, 2017
So far, market reaction to this report has been muted and non-committal, as evidenced by the long tails on both the tops and bottoms of the candles of the following 5 minute intraday chart of the SPX.
This lack of commitment by traders is also prevalent in the day-to-day action since June, as shown on the following Daily chart, which is consistent with what I reported in my post of July 2nd (which presented an outlook for longer timeframes for this market).
So, if traders were looking for any type of catalyst from the Fed to move this market higher (or lower) in the short term, I'd say this report wasn't the ticket.
Tuesday, July 04, 2017
Sunday, July 02, 2017
So far, this year's candle is a bit less than half of 2016's trading range and the Momentum indicator is almost as high as it was in 2014 (this year's trading range is about 60% as high as 2014's).
What this tells me is that, on an annual basis, 2017 is fairly strong at this point and could perform well in the latter half of the year.
Each candle represents a period of one quarter on the following Quarterly chart of the SPX.
The trading range of this year's Q2 candle (which closed last Friday) is about 80% of Q1's range. While the Momentum indicator on this timeframe has been in a moderate downtrend since mid-2014, it rose in Q1 and has dropped a bit in Q2.
So, on a quarterly basis, I'd track the next candle to see whether momentum can surpass and hold beyond that achieved in Q1 and whether Q3's trading range exceeds that of Q2 to indicate firm bullish conviction (assuming that price continues to advance higher).
Each candle represents a period of one month on the following Monthly chart of the SPX.
The trading range of June's candle is about 72% of May's and is a "shooting star" (which is, generally, a bearish signal after a long run-up, such as we've seen since December 2016). Momentum has been flat after dropping in March this year.
However, June's close is higher than May's, so one candle does not necessarily indicate that a trend reversal is imminent. We'd need to see a lower close in July to assess the situation at that time on this monthly timeframe. But, although the close was higher, it was done so by traders with a tepid appetite for equities.
Each candle represents a period of one week on the following Weekly chart of the SPX.
Momentum has been falling since the end of January this year and a great deal of profit-taking has been occurring since March. At the same time, this index has been inching upwards to new highs in a roller-coaster manner.
The close of last week's candle was not lower than the close of the May 30th candle, so I would not call the candle formation, since then, a "tower top" reversal. I'm getting mixed signals as to short-term weekly trend, so am reluctant to forecast further weakness ahead, apart from saying that buyers have been unenthusiastic and non-committal, not only in June, but also in May, because of the extensive amount of consolidation occurring during those months.
Keep an eye on momentum over the coming weeks to see it continues its recent rally on further price advancements, as a confirmation of strengthening buying conviction. Otherwise, we could see a summer selloff ensue, as I described in my post of June 29th.