Tag: S&P 500

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Dow signals fresh advance

Dow Jones Industrial Average recovered above 17000, signaling a fresh advance. Follow-through above 17150 would confirm a target of 17500*. Leveling off of 21-day Twiggs Money Flow in recent days, however, indicates (short-term) resistance. Reversal below 16950 is unlikely, but would warn of a test of 16750.

Dow Jones Industrial Average

* Target calculation: 16500 + ( 16500 – 15500 ) = 17500

The S&P 500 is again testing resistance at 2000. Breakout would offer a target of 2250*. Recovery of 13-week Twiggs Money Flow above its recent (July 2014) high would confirm buying pressure. Reversal below 1950 is unlikely, but would warn of another test of (primary) support at 1900.

S&P 500

* Target calculation: 1500 + ( 1500 – 750 ) = 2250

Declining CBOE Volatility Index (VIX) readings suggest continuation of the bull market.

VIX Index

The Nasdaq 100 broke through the psychological level of 4000. Expect retracement to test the new support level. Respect is likely and would confirm another advance. Recovery of 13-week Twiggs Money Flow above its recent (July 2014) high would confirm buying pressure. Reversal below 4000 is unlikely but would warn of a test of support and the rising trendline at 3750.

NASDAQ 100

* Target calculation: 4000 + ( 4000 – 3750 ) = 4250

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Putin antics fail to impress markets

For all his macho posturing, Vladimir Putin has demonstrated an inability to move financial markets with his antics in Eastern Ukraine. His latest incursion towards Luhansk, with white-painted military trucks bearing aid to the rebel-held city, unchecked by the Red Cross, passed barely noticed. Instead markets are intently focused on nuances from a 68-year old Jewish mum at Jackson Hole, who also happens to chair the Federal Reserve.

I would have loved to call Janet Yellen a “grandmother”, but son Robert Akerlof — himself a PhD in Economics — does not claim any offspring on his CV. The apple doesn’t fall far from the tree. Husband, George Akerlof, is a Nobel prize-winning economist and professor emeritus at University of California, Berkeley.

The image below highlights the differences between the Fed and the ECB:

Fed ECB

The Fed’s more stimulatory approach has paid dividends in terms of economic growth and employment while inflation expectations remain muted. The inflation breakeven rate — 10-year Treasury yield minus the yield on equivalent inflation-indexed securities — continues to range between 2.0% and 2.50%.

Inflation breakeven rate

The ECB’s more austere approach, on the other hand, has caused a world of pain.

Market update

  • S&P 500 tests 2000.
  • VIX continues to indicate a bull market.
  • DAX hesitant rally.
  • China bullish.
  • ASX 200 faces strong resistance.

The S&P 500 hesitated after making a new high on Thursday, but there was no dramatic fall in response to news from Eastern Ukraine. Expect retracement towards 1950, followed by another test of 2000. 21-Day Twiggs Money Flow is likely to re-test the zero line, but respect would indicate strong buying pressure. Breach of support at 1900, warning of a reversal, remains unlikely.

S&P 500

* Target calculation: 1500 + ( 1500 – 750 ) = 2250

Declining CBOE Volatility Index (VIX) indicates low risk, typical of a bull market.

S&P 500 VIX

Germany’s DAX rallied above 9300 on the weekly chart, but 13-week Twiggs Money Flow warns of continued selling pressure. Reversal below support at 8900/9000 would warn of a primary down-trend.

DAX

* Target calculation: 9000 – ( 10000 – 9000 ) = 8000

Shanghai Composite Index is testing resistance at 2250. Breakout would confirm a primary up-trend, signaling an advance to 2500*. Rising 13-week Twiggs Money Flow indicates medium-term buying pressure. Respect of resistance, however, would suggest further consolidation.

Shanghai Composite Index

* Target calculation: 2250 + ( 2250 – 2000 ) = 2500

Tall wicks on ASX 200 daily candles indicate strong resistance at 5650. Respect would suggest retracement to 5550, while follow-through would be a strong bull signal, suggesting an advance to 5850*. Another 21-day Twiggs Money Flow trough above zero would indicate long-term buying pressure. Reversal below 5450 is unlikely, but would warn of a test of primary support.

ASX 200

* Target calculation: 5650 + ( 5650 – 5450 ) = 5850

Posted on

Putin antics fail to impress markets

For all his macho posturing, Vladimir Putin has demonstrated an inability to move financial markets with his antics in Eastern Ukraine. His latest incursion towards Luhansk, with white-painted military trucks bearing aid to the rebel-held city, unchecked by the Red Cross, passed barely noticed. Instead markets are intently focused on nuances from a 68-year old Jewish mum at Jackson Hole, who also happens to chair the Federal Reserve.

I would have loved to call Janet Yellen a “grandmother”, but son Robert Akerlof — himself a PhD in Economics — does not claim any offspring on his CV. The apple doesn’t fall far from the tree. Husband, George Akerlof, is a Nobel prize-winning economist and professor emeritus at University of California, Berkeley.

The image below highlights the differences between the Fed and the ECB:

The Fed’s more stimulatory approach has paid dividends in terms of economic growth and employment while inflation expectations remain muted. The inflation breakeven rate — 10-year Treasury yield minus the yield on equivalent inflation-indexed securities — continues to range between 2.0% and 2.50%.

Inflation breakeven rate

The ECB’s more austere approach, on the other hand, has caused a world of pain.

Market update

  • S&P 500 tests 2000.
  • VIX continues to indicate a bull market.
  • DAX hesitant rally.
  • China bullish.
  • ASX 200 faces strong resistance.

The S&P 500 hesitated after making a new high on Thursday, but there was no dramatic fall in response to news from Eastern Ukraine. Expect retracement towards 1950, followed by another test of 2000. 21-Day Twiggs Money Flow is likely to re-test the zero line, but respect would indicate strong buying pressure. Breach of support at 1900, warning of a reversal, remains unlikely.

S&P 500

* Target calculation: 1500 + ( 1500 – 750 ) = 2250

Declining CBOE Volatility Index (VIX) indicates low risk, typical of a bull market.

S&P 500 VIX

Germany’s DAX rallied above 9300 on the weekly chart, but 13-week Twiggs Money Flow warns of continued selling pressure. Reversal below support at 8900/9000 would warn of a primary down-trend.

DAX

* Target calculation: 9000 – ( 10000 – 9000 ) = 8000

Shanghai Composite Index is testing resistance at 2250. Breakout would confirm a primary up-trend, signaling an advance to 2500*. Rising 13-week Twiggs Money Flow indicates medium-term buying pressure. Respect of resistance, however, would suggest further consolidation.

Shanghai Composite Index

* Target calculation: 2250 + ( 2250 – 2000 ) = 2500

Tall wicks on ASX 200 daily candles indicate strong resistance at 5650. Respect would suggest retracement to 5550, while follow-through would be a strong bull signal, suggesting an advance to 5850*. Another 21-day Twiggs Money Flow trough above zero would indicate long-term buying pressure. Reversal below 5450 is unlikely, but would warn of a test of primary support.

ASX 200

* Target calculation: 5650 + ( 5650 – 5450 ) = 5850

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The Stock Market’s Missing Ingredient | Bloomberg View

Barry Ritholz discusses why military conflicts around the globe and civil strife in Ferguson, Missouri have little impact on market performance:

….None of this seems to matter to Mr. Market. He continues to power on, oblivious to issues that don’t affect corporate earnings. They have, by the way, been stellar, growing at a 9 percent annual rate. Meanwhile, interest rates are still low and inflation is subdued.

Rarely have conditions for market gains been so promising at a time when investor psychology has been so negative. Gallup reports that only 7 percent of those surveyed were aware of last year’s scorching [29.7%] gains in the Standard & Poor’s 500 Index.

via The Stock Market's Missing Ingredient – Bloomberg View.

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Dow heading for 17000

Dow Jones Industrial Average is headed for another test of 17000/17100 after finding support at 16400/16500. Recovery of 13-week Twiggs Money Flow above its July high would indicate that buyers are back in control. Breakout above 17100 would offer a target of 17500*. Reversal below 16400 is unlikely, but would warn of a test of the primary trendline at 16000.

Dow Jones Industrial Average

* Target calculation: 16500 + ( 16500 – 15500 ) = 17500

The S&P 500 followed through above Friday’s high of 1965, suggesting another attempt at 2000. Completion of a trough above zero on 21-day Twiggs Money Flow would confirm buying pressure. Breakout above 2000 would offer a target of 2250*, but expect markets to remain cautious because of current geopolitical tensions. Reversal below 1950 is unlikely, but would warn of another test of support at 1900.

S&P 500

* Target calculation: 1500 + ( 1500 – 750 ) = 2250

Low CBOE Volatility Index (VIX) readings are typical of a bull market.

VIX Index

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S&P 500 recovers but Europe remains weak

  • Europe continues to test support.
  • S&P 500 recovers.
  • VIX continues to indicate a bull market.
  • China bullish.
  • ASX 200 recovers.

Dow Jones Europe Index continues to test its primary trendline and support at 315/325. 13-Week Twiggs Momentum below zero warns of a primary down-trend. Breach of primary support at 315 would confirm.

Dow Jones Europe Index

The S&P 500 recovered above 1950, suggesting another test of resistance at 2000. Recovery of 13-week Twiggs Money Flow above its July high would suggest that buyers have taken control. Reversal below 1900 is unlikely, but would warn that the primary trend is slowing.

S&P 500

* Target calculation: 1500 + ( 1500 – 750 ) = 2250

CBOE Volatility Index (VIX) remains low, suggesting a bull market.

S&P 500 VIX

Dow Jones Shanghai Index is testing resistance at 295. Breakout would confirm a primary up-trend. Respect of resistance, however, would indicate further consolidation.

Dow Jones Shanghai Index

ASX 200 recovery above 5550 also suggests another advance. Respect of zero by 13-week Twiggs Money Flow would strengthen the signal. Reversal below 5450 is unlikely, but would warn of another test of primary support.

ASX 200

* Target calculation: 5400 + ( 5400 – 5000 ) = 5800

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S&P 500 recovers but Europe remains weak

  • Europe continues to test support.
  • S&P 500 recovers.
  • VIX continues to indicate a bull market.
  • China bullish.
  • ASX 200 recovers.

Dow Jones Europe Index continues to test its primary trendline and support at 315/325. 13-Week Twiggs Momentum below zero warns of a primary down-trend. Breach of primary support at 315 would confirm.

Dow Jones Europe Index

The S&P 500 recovered above 1950, suggesting another test of resistance at 2000. Recovery of 13-week Twiggs Money Flow above its July high would suggest that buyers have taken control. Reversal below 1900 is unlikely, but would warn that the primary trend is slowing.

S&P 500

* Target calculation: 1500 + ( 1500 – 750 ) = 2250

CBOE Volatility Index (VIX) remains low, suggesting a bull market.

S&P 500 VIX

Dow Jones Shanghai Index is testing resistance at 295. Breakout would confirm a primary up-trend. Respect of resistance, however, would indicate further consolidation.

Dow Jones Shanghai Index

ASX 200 recovery above 5550 also suggests another advance. Respect of zero by 13-week Twiggs Money Flow would strengthen the signal. Reversal below 5450 is unlikely, but would warn of another test of primary support.

ASX 200

* Target calculation: 5400 + ( 5400 – 5000 ) = 5800

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Dow and S&P 500 find support

Dow Jones Industrial Average continues to test medium-term support at the December high of 16500. Breach of support would warn of a correction to the primary trendline — at 16000 — while respect of support would indicate another attempt at 17000. Failure of primary support at 15400/15600 remains unlikely, but would warn of reversal to a down-trend. Completion of another 13-week Twiggs Money Flow trough above zero would suggest long-term buying pressure and another primary advance.

Dow Jones Industrial Average

* Target calculation: 16500 + ( 16500 – 15500 ) = 17500

The S&P 500 found support at 1900. Recovery above 1950 would suggest another advance. Breach of primary support at 1750 remains unlikely. Completion of a higher trough on 13-week Twiggs Money Flow, with recovery above 32%, would indicate that buyers are back in control.

S&P 500

* Target calculation: 1500 + ( 1500 – 750 ) = 2250

The CBOE Volatility Index (VIX) retreated from its recent high, suggesting continuation of the bull market.

VIX Index

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Europe tests primary support

Summary:

  • Europe threatens reversal to a down-trend.
  • S&P 500 finds support.
  • VIX continues to indicate a bull market.
  • China’s Shanghai Composite encounters selling pressure.
  • ASX 200 experiences a secondary correction.

Dow Jones Europe Index is testing the primary trendline and support at 315. 13-Week Twiggs Momentum below zero already warns of a primary down-trend. Breach of primary support at 315 would confirm. Respect of primary support and recovery above 330, however, would suggest that the primary trend is intact.

Dow Jones Europe Index

Germany’s DAX continues to test primary support at 9000. A long tail on Friday suggests short-term support. Failure of support would warn of a decline to 8000*, while respect would suggest another test of 10000.

DAX

* Target calculation: 9000 – ( 10000 – 9000 ) = 8000

The S&P 500 found support at 1900 and recovery above 1950 would indicate another advance. The latest decline on 13-week Twiggs Money Flow is relatively small and recovery above its July high would suggest that buyers have taken control. Failure of 1900, however, would warn that the primary trend is slowing.

S&P 500

* Target calculation: 1500 + ( 1500 – 750 ) = 2250

CBOE Volatility Index (VIX) spiked upwards, to between 16 and 17, but remains low by historical standards and continues to suggest a bull market.

S&P 500 VIX

China’s Shanghai Composite Index encountered selling pressure below resistance at 2250, with tall wicks/shadows on the last two weekly candles and a sharp fall in 13-week Twiggs Money Flow. Reversal below 2150 would warn of another test of primary support at 1990/2000. Follow-through above 2250, however, would confirm a primary up-trend.

Shanghai Composite

* Target calculation: 2000 – ( 2150 – 2000 ) = 1850

The ASX 200 is heading for a test of support at 5350/5400 and the primary trendline. Direction will largely be influenced by the US and Chinese markets, but reversal of 13-week Twiggs Money Flow below zero — after long-term bearish divergence — would warn of strong selling pressure. Recovery above 5550 is unlikely at present, but would suggest another advance. Reversal below 5050 is also unlikely, but would signal a trend change.

ASX 200

* Target calculation: 5400 + ( 5400 – 5000 ) = 5800

Posted on

Europe tests primary support

Summary:

  • Europe threatens reversal to a down-trend.
  • S&P 500 finds support.
  • VIX continues to indicate a bull market.
  • China’s Shanghai Composite encounters selling pressure.
  • ASX 200 experiences a secondary correction.

Dow Jones Europe Index is testing the primary trendline and support at 315. 13-Week Twiggs Momentum below zero already warns of a primary down-trend. Breach of primary support at 315 would confirm. Respect of primary support and recovery above 330, however, would suggest that the primary trend is intact.

Dow Jones Europe Index

Germany’s DAX continues to test primary support at 9000. A long tail on Friday suggests short-term support. Failure of support would warn of a decline to 8000*, while respect would suggest another test of 10000.

DAX

* Target calculation: 9000 – ( 10000 – 9000 ) = 8000

The S&P 500 found support at 1900 and recovery above 1950 would indicate another advance. The latest decline on 13-week Twiggs Money Flow is relatively small and recovery above its July high would suggest that buyers have taken control. Failure of 1900, however, would warn that the primary trend is slowing.

S&P 500

* Target calculation: 1500 + ( 1500 – 750 ) = 2250

CBOE Volatility Index (VIX) spiked upwards, to between 16 and 17, but remains low by historical standards and continues to suggest a bull market.

S&P 500 VIX

China’s Shanghai Composite Index encountered selling pressure below resistance at 2250, with tall wicks/shadows on the last two weekly candles and a sharp fall in 13-week Twiggs Money Flow. Reversal below 2150 would warn of another test of primary support at 1990/2000. Follow-through above 2250, however, would confirm a primary up-trend.

Shanghai Composite

* Target calculation: 2000 – ( 2150 – 2000 ) = 1850

The ASX 200 is heading for a test of support at 5350/5400 and the primary trendline. Direction will largely be influenced by the US and Chinese markets, but reversal of 13-week Twiggs Money Flow below zero — after long-term bearish divergence — would warn of strong selling pressure. Recovery above 5550 is unlikely at present, but would suggest another advance. Reversal below 5050 is also unlikely, but would signal a trend change.

ASX 200

* Target calculation: 5400 + ( 5400 – 5000 ) = 5800

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