Category: Financial Markets Update

FOR WEDNESDAY: (11/29) Will North Korea’s latest missile test upset the bull? Sometimes for 1-2 days but usually not more. The peak of a speculative bubble cycle is due by Sunday and that may mean that stocks and Bitcoin finally take a rest after that and bank profits before Christmas. Upper targets for stocks that we thought might take until 2018 are close at 2640 now on the S & P. We still see a June 2018 cycle high for stocks so it is not over. Congress does need to agree on a budget ceiling extensions with that key date into Dec. 8. Any major rambling and rumblings and the market might get upset but the thought is that they will come up with a stop-gap remedy. We should start to congest early week gains for now.Continue reading

FOR TUESDAY: (11/28) Mondays often have to be discounted as a throw away day and volume usually increases on Tuesday. The week of employment report is often congestive and we’re still dealing with month-end position squaring into Thursday. Congress will recess on Dec. 14-15 and the thought is that they will do a stop-gap extension for weeks for the Dec. 8 government funding ceiling and try to pass something shortly thereafter. It’s thought that the first week of Congress being back will focus on the Tax bill, and getting that through will be crucial for the bulls–and we’re skeptical given cycles and where markets are and the way they’re acting.Continue reading

FOR MONDAY: (11/27) Thin holiday trading can be exaggerated. Expecting topping action on S & P by Monday, as cycles turn negative later into the week. Dollar move not a panic sell unless it closes below 9295. Will have to confirm cycle highs on the dollar for Dec. 10. Gold cycles are weak this week.

DEC. E-MINI S & P 500
TRADING RECOMMENDATION: Wait for morning comments.

S & P ANALYSIS FOR MONDAY: (11/27) We knew that 2600 would come out easily. Projection first is to 2609.75 with parabolic support at 2596.75 not likely to come out easily. For now the market still is up into Monday with resistance at 2612 and key resistance at 2617 on cash. We looked at next week and it could take until Dec. 1-3 to get cash up to 2617 so if we get no downside follow-through starting Tuesday, market will be congestive mode. Patterns seem clear.

OVERALL: Expecting topping action by Monday, as cycles turn negative later into the week into Dec. 1st. The divergent high to 2607 may come and maybe cash will get up to 2617. We’re seeing at least a 110-point fall to 2485. Lower target is possible to 2400-2385. It does look like a Christmas recovery will happen the week of Dec. 11-15 and possibly into the Dec. 22.

CYCLES OVERVIEW: Topping Monday; lower into Thursday; higher Friday.

FOR THURSDAY/FRIDAY: (11/24) Thin holiday trading can be exaggerated and we’re only interested in buying T-notes if we can get in tonight. Dollar move not a panic sell unless it closes below 9295. Will have to confirm cycle highs on the dollar for Dec. 10.Continue reading

FOR WEDNESDAY: (11/22) Will anyone be home and trading? Always worried about thin holiday conditions which make stop placement precarious. We will go with the larger patterns and see if we can survive crazy holiday conditions. Usually we find that patterns get completed after the long weekend if we are patient but if we see the wrong cycles we may have to get out.Continue reading

FOR TUESDAY: (11/21) Always worried about thin holiday conditions which make stop placement precarious. We still like short gold and silver and long crude and will go with those new trades. We also like long stocks but want to make sure there are not any nasty surprises in the morning.

DEC. E-MINI S & P 500
S & P ANALYSIS FOR TUESDAY: (11/21) We had hoped for a congestive few days between 2562-2585 but probably won’t get it. In the end, with thin holiday volume, the market should reach up to 2605 on futures with extensions up to 2617 on cash which will be close on futures. Ideally we could see a top by Monday with end of the month profit-taking likely into Nov. 30. These markets will often do a lot on Wednesday night/Thursday/Thursday night around Thanksgiving and you have to take home length to catch it. We had thought that Tuesday might be the strongest day higher.

Resistance overnight at 2689 and support at 2577-8. May have to buy that dip. The worst-case scenario would be an overnight dip to 2562.50, which would have to be bought also.

OVERALL: The market did generate a negative weekly chart close and a first Hindenburg signal so we’re right about topping action here but it will always go a bit more than expected and these 4th-wave fake-outs are frustrating. The divergent high to 2607 may come and maybe cash will get up to 2617. We’re seeing at least a 110-point fall to 2485. Lower target is possible to 2400-2385. It does look like a Christmas recovery will happen the week of Dec. 11-15 and possibly into the Dec. 22.

CYCLES OVERVIEW: Higher Tuesday; sideways to higher Wednesday/Thursday; pulling back Friday; higher Monday.

FOR MONDAY: (11/20) We’re happy to put this whippy week behind us.  The problem is that thin holiday action before Thanksgiving can be either non-eventful or too crazy in going after stops in thin conditions. Our strategy is usually not to trade too much before Thanksgiving and my trading tutors have always taught that Nov 8-Dec. 31 is a thinner volume atmosphere.

Lately weekend politics has been tricky and China implosions are always negative possible events for Sunday night. We think stocks are lower on Sunday anyway. Still, eventually, given the breakout and new highs on NQ, we have to assume that SP cash could get to 2617 before all is done. Last few days have been difficult, as we have had a number of larger 4th waves that seemed like trend changes but then they are recovering to keep the trend intact. New highs on NQ remind us that it’s too early to write the stock market’s obituary.

FOR FRIDAY: (11/17) Last few days have been difficult, as we have had a number of larger 4th waves that seemed like trend changes but then they are recovering to keep the trend intact. New highs on NQ remind us that it’s too early to write the stock market’s obituary. All we had is a complex 4th wave into Wednesday’s low and the trade did what they did best—buy the dips! Action should continue overnight and on Friday but Sunday and Monday look lower. We’re sensing that the wild moves in gold and the dollar and t-notes the last few days weren’t game changers but just parts of complex congestion patterns. Still, we have to be patient before tipping our foot back in the water and are waiting for more clues. We’re getting close to Thanksgiving next week and thin volume and we need to see some definitive patterns by Monday; otherwise, we may end up with holiday congestive messes.

FOR THURSDAY: (11/16) Last few days have been difficult, as we got the dollar wrong and even crude and bonds failed to work. Luckily our stock index shorts are working. Whippy action likely to continue with a dollar high on Thursday and gold low.Continue reading

FOR WEDNESDAY: (11/15) Lots of surprises in the markets and a lot of gyrations about hopes and fears around the tax bill impacting the dollar and other markets. Will have to see what develops overnight but usually a market in motion stays in motion, and that may mean we’re wrong about the dollar and the euro this week. Stocks teetering on the edge.Continue reading