Crypto carnage looks to extend in the short run

in Technical Strategy

Thursday’s CPI report could be the most volatile time this week, with SPX at-the-money straddles pricing in a 2% move.  As discussed, the hyper-weakness in Technology combined with the uptick in cross-asset volatility have most market participants wondering whether this will metastasize across global risk assets or largely be contained to severe weakness in crypto-currencies only.  Wednesday did show excessive …

Upticks – November 2022

November 9, 2022 in Technical Strategy

Update/Introduction History shows Sir Isaac Newton not only to have excelled as a mathematician and physicist, but also to be a skilled astronomer, alchemist, theologian, and author. Many who have studied Newton’s history know that he published a book called “Opticks” back in 1704, expounding his corpuscular theory of light. He considered light to be made up of extremely subtle …

Two key scenarios to consider as uncertainty lingers

November 8, 2022 in Technical Strategy

The recent rollercoaster in Equity prices looks to be a negative given all the uncertainty in early November ahead of this week’s CPI.  I had argued that prices might start to stall out and turn back lower, and I don’t think Tuesday’s minor bounce relieves fears of that happening.  Four key negatives are still in place:  First, Technology remains quite …

Negatives increasing after bounce; Short-term Peak likely by Thursday

in Technical Strategy

The spike back above 3800 might have seemed positive to many investors after $SPX successfully held 3700 last week, but technically last week’s deterioration remains a larger technical concern heading into mid-term Elections and CPI data.  As charts show, the uptrend from 10/13 lows was violated on last week’s pullback, and the wave structure was very negative on last week’s …

Technology downturn is not encouraging; Volatility looks possible into 11/10-15

November 3, 2022 in Technical Strategy

Increasingly it’s looking like Wednesday’s abrupt reversal could lead to a greater amount of volatility in the short run ahead of November’s all-important CPI report and mid-term elections. While rates seem to be close to peaking out, which would coincide with Equities bottoming, uptrends were broken from mid-October, and Technology is turning down more quickly than is comfortable.  The real …

Violent whipsaw during Powell’s speech keeps rates trending up

in Technical Strategy

The rollercoaster of price action into and after the FOMC’s rate decision proved to be dizzying for many market participants, and the specific act of Treasury yields firming after Powell’s comments proved to be detrimental to US equity markets.  Specifically, the 2-year yield along with 10-Year yield both showed whipsaws that caused rates to turn back sharply higher following earlier …

Equities likely to bottom after FOMC as Rates turn down

November 1, 2022 in Technical Strategy

The recent rollercoaster has been nearly 100% rate driven, as early pullbacks Tuesday on rumors of China forming a coalition to study how to exit their Covid-0 policy coincided with a sharp pullback in Treasury yields.  Whether or not this can ever be trusted to be correct is dubious as we’ve seen a number of false starts lately.  However, better …

Will the FOMC deliver the “Trick” or the “Treat”?

in Technical Strategy

Happy Halloween to All! The minor selloff during Monday’s session didn’t serve to detract too much from what’s been a stellar month for $SPX.  As seen below, $SPX has been trending up nicely, higher by over 10% from 10/13 intra-day lows and higher by nearly 8% for the month of October.  Thus, the combination of negative sentiment, bullish mid-term seasonality …

Lots of reasons to suspect 4Q of 2022 might turn out like 1962

in Technical Strategy

Friday’s about-face seemed impressive after just a minor pullback late week. Yet a few negatives remain present that will need to be resolved before projecting higher into December.  First, negative divergence remains between the NASDAQ and $SPX (See NASDAQ below) as prices remain under early October highs.   Second, DeMark indicators are now showing confluence of 60, 120 min and Daily …

AAPL earnings Miss likely jumpstarts short-term pullback

in Technical Strategy

Thursday’s post close selloff in $AAPL likely jump-started the pullback that could last into early November.  Factors such as near-term overbought conditions on intra-day charts, and the sudden deterioration in large-cap Technology look important just as S&P futures reached the 38.2% retracement of its August-October decline.  Moreover, this period in late October was thought to be significant as a temporary …