Category: Financial Markets Update

FOR TUESDAY: (11/14) Not a lot of reports on Tuesday. Stock market remains top  heavy and is waiting for something to pull it down, probably on Wednesday.Continue reading

FOR MONDAY: (11/13) Not seeing a volatile weekend in the world but we do have concerns around the Middle East, and anger and aggression cycles increase Nov. 14-19. Still, there are enough factors that peace should still dominate. The US has a difficult cycle Nov. 15-Dec. 14, and that may create frustration around the tax bill, which is already delayed until January and we wonder when the budget deficit crisis will rear its head. Monday may be a transition day but stocks are topping and getting ready for the next push lower.

FOR FRIDAY: (11/10) Still not a lot of news but tensions in the Middle East will make taking positions home harder. Stocks fell enough to confirm a temporary top but not confirmed on a closing basis, as the computers bought it back into the close. We do see a number of shifts over the weekend and hope that weekend war news doesn’t create any surprises.Continue reading

FOR THURSDAY: (11/9) Still a really quiet week on the news front. Key cycle is Friday for many markets so not in a rush to get into major trend changes until Monday. Will assume that gold will hold up. Open to a congestive pullback for stocks for a few days but that seems like a luxury these days.Continue reading

FOR WEDNESDAY: (11/8) We have a low-confidence read on the week, with a key cycle into Thursday/Friday suggesting a low for stocks, a high for notes, a low for the dollar and a high for gold and higher prices for crude. We’ll give stocks a chance on Wednesday for a divergent high. No major reports on Wednesday so the trade may have trouble going anywhere.Continue reading

FOR TUESDAY: (11/7) We have a low-confidence read on the week, with a key cycle into Thursday/Friday suggesting a low for stocks, a high for notes, a low for the dollar and a high for gold and higher prices for crude. These markets are overdone from last week so gold retracing to 1290 and the dollar and euro retracing are healthy and crude is breaking out with the close above 5500 and everyone is hopping on board. Never trust the short side of stocks but 2600-4 on the S & P futures is very major resistance for this market and is close.Continue reading

FOR MONDAY: (11/6) Cycles are positive mostly on Monday and the worst of the general cycles that we have gone through are ending over the weekend. That may give bulls a renewed reason to buy stocks. We have a low confidence read on the week but we have completed research on cycles and patterns into Christmas and have reported below.

DEC. E-MINI S & P 500
S & P ANALYSIS FOR MONDAY: (11/6) Given Nasdaq’s reaction off of the Wednesday night low and the SP above 2580, we will assume that the correction was over Wednesday night and that there are still two new highs coming. First resistance at 2600-4 on futures and then cash projects 2617-8, which could push futures up to 2620. We’re open for another week up because it might take that long to get that market to those levels, with the earliest time window during the early part of the week.
SHORT-TERM (11/3) Stocks are running out of time at publication. Upper cash pattern completions are at 2617-8. We could see the market hold up as late as Nov. 13 but the market looks lower into Nov. 17 and while the market is often up into Thanksgiving, at best it looks sideways to lower and then lower into Dec. 6-8 around the budget crisis deadline. It does look like a Christmas recovery will happen the week of Dec. 11-15 and possibly into the Dec. 22.
OVERALL: We’ve been watching 2600-4 as a key pattern completion for futures but that could extend to 2615-20 based on cash patterns. At the moment, we can only count on a 110-point pullback into December, which would be less than 5%. We think that 2490-2500 will hold dips this year.
CYCLES OVERVIEW: Higher Monday and probably Tuesday/Wednesday.

FOR FRIDAY: (11/3) Climax day with employment report. Cycles have a lot of speculative energy so we should see big moves. Dollar would be more complete to the upside to 9556 but not sure we will get it for the ideal short into next week. Gold ideal projection for a short is at 1295-8. NQ fell enough that we don’t need to see 6190 come out before seeing 6300 and APPL beat expectations so will it be sell the fact or run NQ to the moon? Usually you can count on the latter.

DEC. E-MINI S & P 500
TRADING RECOMMENDATION: Wait for morning comments.
S & P ANALYSIS FOR FRIDAY: (11/3) The 35-point correction is probably in progress toward 2550 but the current movement is probably a b-wave retracement, which means that it will frustrate late bears. Seems unlikely that 2579-80 will easily come in for the B-wave. Still, we’re open to another 22-point push lower from wherever it stops today into Friday and then one more new high. It’s possible that the entire 4th wave is done and new highs to 2605 won’t come next but that is not favored.
NEAR TERM: We’re running out of time to complete upside patterns. Realistically even if we hit 2600-2605, we may only expect a 110-point fall and not a 200-300 point fall but we are closer to something bigger happening.
OVERALL: After the first few weeks of November, market looks lower into Thanksgiving–and if that major target of 2600 does come in, it may set up at least a 110 point correction finally. But until then, it should be business as usual. There is a sense that volatility is going to increase and having wide swings in a choppy range would make sense.
LONGER-TERM: Cycles are intense in the world but the market continues to ignore them. At best if we are to get a pullback to 2490, it may come from 2600 and it may take more time to manifest, with December being vulnerable with the budget deficit.
CYCLES OVERVIEW: Lower Friday.

FOR THURSDAY: (11/2) This has been a doggy week and Wednesday’s FOMC action was the least volatile I can remember in 20 years. Trade waiting on employment report but markets are a bit stretched out and should start retracing on Friday.

DEC. E-MINI S & P 500
TRADING RECOMMENDATION: Wait for morning comments.
S & P ANALYSIS FOR THURSDAY: (11/2) Ended up being a dud day and we can make a case that minimum patterns were completed on the cash charts but 2592 would be more ideal, and that is close to 2590 on futures. Thursday had looked higher but we’re at a point where a 35-point correction on futures would go to 2550 before a new high to 2604-5. If Thursday is sideways without new highs, then a negative employment report could trigger the 35-point correction and then one last new high to 2604. Will look for clues in the morning on how to trade this market. We definitely want to sell a divergent new high or a bad failure. Friday seems like a more secure downward day.
OVERALL: After the first few weeks of November, market looks lower into Thanksgiving–and if that major target of 2600 does come in, it may set up a 300-point correction finally. But until then, it should be business as usual. There is a sense that volatility is going to increase and having wide swings in a choppy range would make sense.
LONGER-TERM: Cycles are intense in the world but the market continues to ignore them. At best if we are to get a pullback to 2320, it may come from 2600 and it may take more time to manifest, with December being vulnerable with the budget deficit.
CYCLES OVERVIEW: Higher Thursday; lower Friday.

FOR WEDNESDAY: (11/1) We have a low-confidence read on the FOMC announcement and reaction. It seems that most of the time the pundits are wrong about these things anyway so you usually can fade the news. At the moment, we have a bias toward lower dollars and higher gold into Friday and lower T-notes into Thursday and a possible pullback for stocks, which of course will be bought. The trade is also waiting on employment report so it could be a big reaction and then another hurry up and wait until Friday.

DEC. E-MINI S & P 500
TRADING RECOMMENDATION: Wait for morning comments.
S & P ANALYSIS FOR WEDNESDAY: (11/1) Not much to add to last night. A bullish FOMC reaction would take the market up to 2588. The worst downside might go to 2553.75 and given the way this market runs, that would be a long shot. Cycles are such that break after the report are there. We often see a move higher 5 points before the news and then a pullback.
OVERALL: After the first few weeks of November, market looks lower into Thanksgiving–and if that major target of 2600 does come in, it may set up a 300-point correction finally. But until then, it should be business as usual. There is a sense that volatility is going to increase and having wide swings in a choppy range would make sense.
LONGER-TERM: Cycles are intense in the world but the market continues to ignore them. At best if we are to get a pullback to 2320, it may come from 2600 and it may take more time to manifest, with December being vulnerable with the budget deficit.
CYCLES OVERVIEW: Volatile Wednesday; higher Thursday.