Saturday 30 November 2013

Weekend update - World monthly indexes

World equity indexes continue to broadly climb, in a strong wave that began in early summer. The US, German, Japanese, and Chinese markets were especially strong in November, with gains of around 3-4%. Outlook into spring 2014 remains bullish, with a further 10/20% of upside.


Lets take our monthly look at ten of the big world indexes

Greece


The economy of Greece has long since collapsed, but its equity market is managing to hold the gains of the summer. A month or two of chop seems likely, before renewed upside into late spring. Next key resistance is in the 1300s. A monthly close in the 1400s should confirm the Athex will 'broadly' climb to around 2500..even 4000, by late 2015/early 2016.


Brazil


The Bovespa slipped -3.3% in November, but it is still comfortably above the summer lows - which had briefly opened the door to more severe downside. Baring a break under the big 50k psy' level, next upside target is 60k, which seems viable by late spring.


France


The CAC was fractionally lower on the month, but all things considered, it is doing well to hold the strong gains of 2013. Upside to 4750/5000 looks viable by early next summer.


Germany


The economic powerhouse of the EU, the DAX climbed a very impressive 4.1% in November. The big 10k looks very viable by late spring 2014. The old double top of 2000/2007 is now fading..far...below.


UK


The UK economy is struggling, and this is indeed reflected in the FTSE which - unlike Germany and the USA, is stuck around the old declining resistance. Even so, the UK market looks set for higher levels into the spring. The next obvious target is the historic high of 6950 - that dates back to Jan'2000. That is only 4-5% higher..and looks likely to be tested within the next few months.


Spain


The ugly EU PIIGS member - that is the IBEX, declined slightly in November, but off the lows, and looks set for higher levels in 2014. First target is the 12000 price cluster zone from late 2009/10. That is a good 22% higher than current levels.


USA - Dow'30


The Dow itself has been one of the more laggy of the US indexes, but it has decisively broken up and out of a six month trading range - arguably a giant bull flag, and looks set for 17000/500 by late spring. With continued QE from the Fed, there is very little preventing the US markets from continuing to broadly rally.

Equity bears should keep in mind that the Dow could fall 1000pts, and it still wouldn't break the broader upward support from Feb' 2009 (note, that line cuts off the March floor-spike, and links up better, forming a more conservative support/trend).


Italy


The other of the larger EU PIIGS - Italy fell -1.7% in November, but is still a hugely significant 4000pts (23%) above the summer low. The big 20k psy' level looks set to be broken in the next few months. After that, the key target zone - before the next intermediate top, is around 22000/500.


Japan


The Nikkei is unquestionably very much like the US Dow, literally 'fuelled by QE'. The Nikkei looks set to close the year in the 16000s, and that will break a declining trend that goes back TWO DECADES.

I can not over-state the importance of this key threshold. Once we get a monthly close >16k, equity bulls should expect 17500/18000 by end of Q2' 2014..before the next pull back. Looking even further out, by late 2015, the Nikkei should be somewhere in the 21-23k zone..if not higher.


China


The China market has badly lagged..and indeed failed, to be party to the global equity ramp since 2009. Indeed, the Shanghai Comp' is still 60% lower since the 2007 peak. However, for November, the index gained an important 3.7%, and now looks set for another attempt to hold the 2500s.

A monthly close >2500 will open the door to 3500, not next year...but more likely..late 2015.


Summary

Certainly, some of the world markets are tired after the very significant post summer ramp. Yet, with the economic leaders of the USA, Germany, and Japan all posting strong gains, it is likely that the weaker markets will at least 'hold together'..before they too jump higher across the first half of 2014.

More than anything, look to the Nikkei, for that year end close in the 16000s. It will be a powerful sign that the bull maniacs have another 4-6 months of upside yet to come.

Yes, there will be minor retracments along the way - not least with the US debt ceiling/budgetary issues in Jan/Feb, but broadly..the bigger trend should very much remain to the upside.


Looking ahead

Next week should be kinda interesting. We have ISM manu' and construction data on Monday. Tuesday has store sales data, although no doubt..there will be a lot of news reports about weekend retail sales on Monday.

Wed' is busy with ADP jobs, new home sales, and perhaps most important..the Fed beige book. Thursday will see weekly jobs, factory orders, and the final reading for Q3 GDP, market is seeking

The week concludes with the big monthly jobs number.  Keep in mind, there are a few Fed officials on the loose on Thur/Friday, and their comments will likely move the market one way..or another.

*there is very heavy QE next week, Tues', Wed', and Friday. Bears..beware!
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21 trading days

It is a somewhat scary thought to realise that there are just 21 trading days left of 2013. For the remaining 'doomer bears' out there, it has without question, turned out to be the worse case scenario. A hyper-ramp, now 25 months in duration, with a probable further 4-6 months yet to go.

I will be here for the next big intermediate top next spring, I sincerely hope you are too!

back on Monday :)

Another week.. and month of gains

Despite a touch of weakness in the closing hour, it was another weekly, and net monthly gain for the US equity indexes. Primary trend remains outright bullish, with upside to Dow 17000/500 by late spring 2014. The equity bears have another 4-6 months to wait.


sp'weekly4 - hyper-bullish, mid-term


Dow, monthly'2, rainbow


Summary

Unquestionably, the US (and world) indexes are outright bullish on the short, mid, and long term cycles.
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Santa is coming..and no doubt, there will be 'green shoots' in early 2014.

Yes..there are the debt ceiling/budgetary issues for Jan/Feb...and indeed, I'd guess there will be a minor 4-6% pull back at that time, but then, another ramp into April/May. Best guess remains..an intermediate top next spring, and then a few months of significant downside..on the order of 17/22%.

Have a good weekend

Goodnight from London
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*next main post, late Saturday, on the World monthly indexes

Friday 29 November 2013

Daily Index Cycle update

Another day of new highs for many of the indexes, although there was a touch of weakness in the closing hour, with the sp' settling -1pt at 1805. Next week offers further upside, into the 1820/30s...no doubt helped by a very heavy amount of QE-pomo.


sp'daily5


Dow


Summary

There is little to add, near, mid, long term trends are all upward.

With heavy QE next week..equity bears haven't a hope.
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Closing update from Riley



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a little more later...

Volatility spikes into the weekend

With the main indexes seeing some closing hour weakness, the VIX spiked, settling +5.55% @ 13.70.    Across the week, the VIX gained 11.75%. Near term outlook is for the VIX to remain in the 11/15 zone. VIX 20s remain unlikely until late Jan'2014.


VIX'60min


VIX'daily3


VIX'weekly


Summary

Little to add.

VIX remains low..and set to remain that way until January.

Minor opportunity for a spike into the mid teens..but really. even that doesn't merit any serious attention.
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more later...on the indexes

Closing Brief

The main indexes broke another new set of historic highs, but closed a touch weak, with the sp -1pt @ 1805. The two leaders - Trans/R2K, closed -0.3% and +0.1% respectively. Next week is offering upside into the 1820/30s, and with heavy QE, equity bears don't have a hope.


sp'60min


Summary

For the bulls..just another day of gains. Certainly, the individual daily gains are nothing significant, but collectively, they sure do add up across the weeks and months. This is an amazing market to watch...and equity bears surely have another 4-6 months to wait.

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I generally try to refrain from any chat on societal issues..but..I think the following merits highlighting...

Black Friday at WMT.



I've no doubt the history/sociology students of the 29'th century will look back on such videos with utter bemusement and horror...much in the same manner that we see the 'witch' burning of many centuries ago.
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Have a good weekend!

*I'll post a few things across the evening....but earlier than normal.
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**The weekend post will be on the World monthly indexes - without question, the most important post I do each and every month.

12pm update - the monthly charts are clear

Whilst the indexes continue to hold moderate gains into the weekly close, the bigger monthly charts are clear. The primary trend remains to the upside, and there is simply little likelihood of a broad multi-month rollover for another 4-6 months.


sp'monthly


Summary

What else is there to say?

QE. QE. QE.
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Notable mover remains AAPL...the 580/600 zone looks on track before year end...



time for tea :)
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12.52pm...rats bailing into the close..but .low volume...it can't be taken seriously.. I think.

11am update - AAPL pushing higher

Whilst the main indexes hold moderate gains, one of the more notable movers remains AAPL, which is now in the $550s. A weekly close in the 550s will keep the door open to 575/580 in the very near term. Metals holding gains, Gold +$15, with Oil similarly higher, +1.3%


AAPL, daily


Summary

Little to say about the indexes..they are just breaking new highs..what else is new?
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With stocks like AAPL set for a further 4-6% higher in the very near term..the broader market will similarly likely continue to battle upward.

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Facebook, a further $1 higher will arguably negate any hope of major downside.


For the FB /momo bears..it is not looking exactly good this morning.

10am update - holiday highs

US equities break new historic highs, and there is simply nothing in the near term that looks to pose a problem to the current rally. Metals are holding gains, Gold +$13, whilst Oil is also 0.5% higher. VIX looks set to melt into the close..which is at 1pm.


sp'daily5



GLD, daily


Summary

So..sp'1811s already. Weekly charts are offering 1715/20 early next week...and the 1840/60 zone will be viable in mid-December.

Continued strength in AAPL, a daily close in the 550s would be pretty important.
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DRYS looking strong..with a clear break on the weekly...


First target is $4..then the 5/6s in early 2014.

Pre-Market Brief

Good morning. Futures are slightly higher, sp +2pts, we're set to open around 1809. Metals are trying to jump, Gold +$14, Silver +1.2%. Equity bulls remain fully in control, and look set for further gains across next week.


sp'60min


Summary

A likely quiet day ahead.

No sig'QE, no econ-data..and not even any Fed people lurking out there.
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Notable early mover: DRYS, +8% to 3.58....and I don't know why. Maybe the BDI is higher?
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Naturally, if there was one store where the 'animals' would go crazy over electrical goods, it'd be the UK owned Walmart subsidiary... ASDA. It appears some of the UK retailers are trying to drive sales, even though we don't have the thanksgiving holiday.  - see BBC news.

Thursday 28 November 2013

Copper and Oil remain weak

Whilst equities continue their relentless QE-fuelled rise, the two big economic commodities - WTIC Oil, and Copper, remain very weak. Both are somewhat close to thresholds, which if broken, would portend for much lower levels next year.


Copper, monthly



WTIC Oil, monthly'2, rainbow


Summary

Suffice to say...it remains notable how equities just keep on rising, whilst the broader commodities keep on falling. It remains important to keep in mind..these lower prices are going to help the broader economy to a rather significant extent.

Certainly, one of own major concerns of the relentless QE was that of rising Oil prices. Yet..so far..for whatever reason, the hot money is just now flowing into the commodities pool. Eventually though..that will probably change.


Looking ahead

The only thing due tomorrow is the Fed balance sheet and money supply data..but those are long after the market closes..and few care about those issues anyway.

*next sig' QE is next Tuesday.
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We have a short Friday ahead. Market closes at 1pm, and considering recent price action, it will probably be a dull session for the main indexes, although no doubt some individual stocks will have some good action. I would especially look to AAPL for further upside..into the $550s.

If retail sales across this holiday period come in at least 'reasonable'..market will have yet another excuse to rally into year end.

Goodnight from London

Bull maniacs giving thanks to the Bernanke

Another set of new index highs for US equities, and without question, the bull maniacs - who think everything is fine with the 'new economy', owe much of the last two years of gains (68%) to the Bernanke. It remains a wonder just what the Yellen monster will bring across 2014/15.


sp'weekly4 - hyper-bullish outlook


Summary

Things remain very much on track. General upside into end year, a probable moderate drop in late Jan/Feb, before a final lurch higher in late spring. A major drop next summer/autumn..sure would make for a damn change!


Nikkei...almost there

As I've been highlighting for much of this year, the Nikkei monthly chart is a critical one for equity bulls to monitor. First target is a monthly close in the 16000s, that now looks very likely for December..and will open the door to 17k in the spring (along with 17k Dow)...and eventually 20k in 2015.

Nikkei, monthly, 20yr


Just another 550pts to go, and that will be more than enough to clarify the TWO DECADE declining trend/resistance has been broken. That will be an extremely important milestone for global equities, and be a massive reminder of the underlying global up trend.

*I will cover the Nikkei and other world indexes in more depth, this coming weekend.
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Looking ahead

I'll deal with Friday, in a late evening Thursday post.

*I will probably post one or two things tomorrow, so..check in...between those heavy servings of QE, I mean..turkey.
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Goodnight from London

Daily Index Cycle update

The main indexes closed moderately higher, with the sp +4pts @ 1807. The two leaders - Trans/R2K, both settled +0.6%. Near term outlook is for broadly higher levels, with the sp'1810/20s viable next week.


sp'daily5


R2K


Trans


Summary

Yet another day for the equity bulls..and indeed, the bears simply lack any downside power.

Near term trend is only offering a 1.5/2.0% retracement at most..and even that looks difficult, not least with heavy QE-pomo next week.

Best guess..the 1810/20s next week.
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Video update from Riley



I have to agree, more likely than not...upside into early December, the very heavy amount of QE-fuel will no doubt really help. 

a little more later...

Wednesday 27 November 2013

Volatility micro spikes into the close

Whilst equity indexes clawed moderately higher, the VIX managed to hold positive, with a micro spike into the close, +1.3% @ 12.98. Near term outlook is for VIX to remain in the 11/15 zone. VIX >20 does not look viable until at least late Jan'2014.


VIX'60min


VIX'daily3


Summary

There is little to add. VIX remains bizarrely low, and will likely remain so until the new year.
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more later..on the indexes

Closing Brief

US equities closed moderately higher, with the sp +4pts @ 1807. The two leaders - Trans/R2k, broke new highs, both settling +0.6%. Near term outlook remains a little uncertain, but the broader trend remains unquestionably strong.


sp'60min


Summary

Another day for the bulls..and bears just lack any real downside power..as has been the case for almost the entire year.

With heavy QE next week, I'm resigned to assuming higher levels..rather than even a slight 1-2% retracement.
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Well..to all those in the USA..have a good thanksgiving!

To everyone else on the planet..enjoy the day off!
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The usual bits and pieces to wrap up the day...across the evening.

3pm update - bulls giving thanks to QE-pomo

Across the last 25 months, the sp'500 has rallied 68%. It is probably safe to argue that 90% of those 730pts are due to the Fed. Unquestionably..the bull maniacs should be giving all their thanks to the Bernanke..and soon...the Yellen monster.


sp'60min (with metals)



AAPL, daily


Summary

New QE-pomo schedule for December  (released @ 3pm)

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*AAPL looking strong, and set for further gains in the remainder of the year, 580/600 looks a relatively easy target zone to hit.
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Unlike yesterday..I don't think there is much chance of any sig' closing hour rollover. More likely..we'll even see a touch of algo-bot melt into the close.

Weekly charts are offering sp'1815/25 into next week.
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*I will hold short-SLV, across the Thursday break....seeking an exit in the 18.60/50s

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3.05pm.. Jeez, look at the QE schedule for next week.

HEAVY QE.. Tue, Wed, and Friday. Bears haven't a hope.


3.15pm.. Bitcoin breaks $1000.   That is bullish for the broader market...yes?

I will note Santelli on clown finance TV, I do understand the irony in that BTC might soon be priced higher than a real oz' of Gold. 
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3.41pm... just look at this nonsense...

AMZN, daily



The 400s soon..and probably 500s by end spring 2014.  Utter...madness!

2pm update - continued micro chop

The main indexes are holding slight gains, after briefly turning red. It remains a naturally quiet pre-holiday day. Metals remain weak, Gold -$3, Silver -0.8%. Oil is significantly lower, -2.0%. VIX looks set to melt lower into the close.


sp'60min



AAPL, daily


Summary

Little to add..things are likely to largely flat line into the close.

Certainly.. sp' is still stuck under the 1808 high, but hey..other indexes are breaking new highs today..most notably the transports.

1pm update - is it turkey time yet?

The main indexes are holding slight gains ahead of the Thanksgiving break. With the sp' still stuck under 1808, there remains moderate chance of downside into early next week, but underlying pressure remains to the upside. Metals continue to slide..along with Oil, -2.1%


sp'60min (with metals)



SLV, daily3, H/S


Summary

Quiet day...as expected.

Most notable..the strength in AAPL, whilst Oil/metals both very weak.
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*I remain short SLV from 19.23, seeking my next exit in the 18.60/50s this Friday/early next week.

My target for the current multi-week cycle is a very clear 17...if not even 15..which would really rattle the gold/silver bugs into year end.

12pm update - quiet afternoon ahead

The indexes look set to flat line into the close. Despite some notable strength in leaders like AAPL, the sp'500 seems unable to decisively clear..and hold above 1808, ahead of the holiday break. Metals have turned red..and Oil remains lower by a significant -1.75%


sp'60min (with metals)


Summary

Price action in the metals looks particularly weak, and I'm in full agreement with Carboni, metals and Oil look set for much lower levels. The latter of course is an obvious benefit to the wider economy..and bodes for better earnings in Q1.

Hey..if yours truly can see..and admit that, why can't the rest of you ;)
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time for lunch :)

11am update - AAPL is telling the story

The current price action in AAPL is very telling for the broader market, and with the break >536, equity bears look to be in a world of hurt for the rest of the year.  Metals look weak, whilst Oil is already significantly lower, -1.5%.


sp'60min (with metals)


USO, daily


Summary

Well, at least there are some things to cover today..so, it shouldn't be too tedious!
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*Near term targets on the weekly cycle... sp'1840/60, Trans 7400, Nasdaq 4200s

As I will keep saying, the notion of a 'significant' sell down into year end looks to be nonsense talk.

Worse still..when the debt ceiling comes around in Jan/Feb..and we do sell lower by 4-7%..many will lose themselves in bearish hysteria..only to get whipsawed in yet another wave higher across March/May.
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Interesting action in DRYS


Looks like DRYS has found a floor in the low 3s..and is now trying to make a break for it..first target is the recent $4 high. A move >4 in early 2014..very viable. For those who are looking for general upside into 2015..I'd have to look for DRYS to be a 15/20$ stock..with the BDI in the 6000s.


11.20am.. AAPL @ 544...looking strong...daily charts offering 570/75 within the immediate term.

10am update - pre-holiday slumber

Good morning. The market opens a touch higher, and looks set for quiet chop across the day. Equity bears face the relentless broader upside pressure.  Metals open moderately higher, with Gold +$7. Oil is significantly lower by -1.5%.


sp'60min



AAPL, daily


Summary

*notable early mover... AAPL..into the 540s..set for the 575/600 zone by end year.
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If we break over 1808..then..I'm not exactly sure what to do with the current wave-count. Besides, the R2K is powering higher...urghh

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Video update from Mr Permabull...who is wildly bullish.



There is a lot to say about the above..suffice to say..finally..someone else out there is touting sp'2100/2200s, which is what I've been suggesting for some months.

As it is..a 'baseline' of sp'1950/2050 in the current Oct'2011 wave, seems 'reasonable'.
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Near term targets...Trans 7400..which might equate to sp'1840/60 zone. On any basis, it still seems pointless to consider any index-shorts until late spring 2014.
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updates across the day!


10.25am... market still stuck <1808....  Oil weak...metals..turning red.

Maybe we'll see a little down wave after all. Regardless...holiday trading...not many around today!

The next big down wave

US equities look set for broad upside into spring 2014, but what then? The current multi-month rally is now 25 months in duration..and by next spring, we will be more than overdue a major correction - probably on the order of 17/22%


sp'weekly9 - fib levels



sp'weekly8 - mid-term bullish outlook


Summary

First...I should clarify my upside target zone for spring 2014.

Dow 17000/500, which should equate to sp'500, somewhere in the 1950/2050 zone.
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For weekly'9 chart above...assuming we max out around 2000. Taking the starting point of Oct'2011..first major fib...0.38%..would take us down to the mid 1600s. That would be a VERY strong and significant wave lower.


Summer/autumn 2011...as summer/autumn 2014 ?

More than anything, I would be looking for the next major wave lower to be somewhat in style to what we saw in 2011. It will probably take a few months to form a clear top, and then only 1-2 months for the major downside to play out.

As many of the chart-cyclists are mentioning, Aug/September 2014 would be a key time zone to look for the market to see a major low put in.

From there...a hyper-ramp into late 2015/early 2016. For me, the only issue is whether the indexes then battle to sp'2500...or much...much higher.


Looking ahead

Wednesday has an array of econ-data...there is certainly something for Mr Market to use as an excuse for further weakness..with easy downside to the sp'1795/90 zone. Of course, since Thursday is closed, volume will likely be even less than today.

*there is no sig' QE-pomo due until at least Friday. The new QE schedule is due Wed' 2pm.
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The closing hour of today was certainly fun to watch and be part of. Hopefully, equity bears can see a little follow through for the rest of the week.

Goodnight from London