Indexanalysis
SPX Daily TA Cautiously BearishSPXUSD Daily guidance is cautiously bearish. Recommended ratio: 15% SPX, 85% Cash.
* BOUNCE WATCH. Equities and Futures continue to plummet after a hawkish FOMC meeting has investors bracing for more rate hikes in 2023. Meanwhile, Commodities, Cryptos, DXY, EURUSD, VIX and US Treasuries are either up or flat. Very 2022. Unfortunately, with Putin's latest recruitment efforts and nuclear/chemical warfare posturing it's starting to feel like that time when Russia/Ukraine headlines may another run at being market catalysts. Key Upcoming Dates: S&P US September Manufacturing PMI at 945am EST 09/23; September US Consumer Confidence Index at 10am EST 09/27; August US New-Home Sales at 10am EST 09/27; Final US Q2 GDP revision at 830am EST 09/29; August US PCE price index at 830am EST 09/30.*
Price is currently trending down at ~$3767 as it risks breaking down out of the descending channel from August 2021 at ~$3825 if it's unable to stop going lower in today's session. Volume is currently Moderate and on track to favor sellers for three consecutive sessions if it closes today in the red. Parabolic SAR flips bullish at $4025, this margin is mildly bullish at the moment. RSI has officially broken below the uptrend line from 01/27/22 and is currently testing the uptrend line from August 2015 at 32 as support, the next support (minor) is at 28.63. Stochastic remains bearish and is currently trending down at 5 as it approaches max bottom with no signs of trough formation. MACD remains bearish and is currently trending down at -68 as it approaches -76.22 minor support which will likely coincide with a retest of the uptrend line from March 2020 (when the Fed started QE and 0%-0.25% FFR) at ~-78. ADX is currently trending up at 22 as Price continues to fall, this is mildly bearish; should ADX get above 25 and Price continue to go down, this would be very bearish and would increase the likelihood of a retest of $3500 minor support for the first time since November 2020.
If Price is able to resist going any lower in today's session and then follow that up with a Bullish Engulfing Candle in tomorrow's session, then it will likely test the lower trendline of the descending channel from August 2021 at ~$3825 as resistance . However, if Price continues selling off, it will likely retest $3707 minor support . Mental Stop Loss: (two consecutive closes above) $3825.
SP500 INDEX PERSONAL ANALYSIS IN THE SHORT TERM (REVERSAL!)Overall evaluation of the SP500 is bearish within a 1-2Y time frame mini trend, but not on the grand picture. Greetings everyone, we dumped very hard this past few days but this is a sign of a potential reversal. The fact that the candle closed as a DRAGONFLY DOJI , this is a warning for all shorters to consider that the bulls are now entering the market. The proper way to trade this signal is to wait for confirmation on the next daily candle, but seeing as how
it is a text-book perfect dragonfly doji on any manual you can find, this is especially stronger in a daily time frame.
We will probably get rejected again on the moving averages after this mini-trend change. The catalyst for the mini dump we had today was a negative sentiment report from U.S. Michigan.
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TIP:
SP500 also had a reverse hammer on the hourly charts followed by a green candle -- also called as a bullish harami.
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SPX Daily TA Cautiously BearishSPXUSD Daily guidance is cautiously bearish. Recommended ratio: 30% SPX, 70% Cash .
*FOMC WATCH. This week is already off to a volatile start with Equities starting in the red and currently attempting to close in the green. Equities, Equity Futures, Cryptos, Energy, DXY and US 10yr Bonds are either flat or up while VIX, EURUSD, US 30yr Bonds and Gold are flat or down. Yesterday on CBS 60 Minutes, US President Biden publicly sent a message to Russian President Putin urging him not to resort to nuclear or chemical warfare in Ukraine and that the West would respond in kind if he were to; meanwhile, Putin is trying to recruit more Russian volunteers to fight in Ukraine. Key Upcoming Dates: US August Building Permits and Housing Starts at 830am EST 09/20; 13th GDPNow US Q3 GDP estimate 09/20; FOMC meeting 09/20-09/21 (Statement Released at 2pm EST on 09/21); S&P US September Manufacturing PMI at 945am EST 09/23.*
Price is currently testing the lower trendline of the descending channel from August 2021 at ~$3850 as support. Volume is currently Low rack to favor buyers if it can close today's session in the green. Parabolic SAR flips bullish at $4090, this margin is mildly bullish at the moment. RSI is currently trending sideways as it tests 38.06 support, if it breaks below this level then the next support is at the uptrend line from August 2015 at ~32. Stochastic remains bearish and is currently beginning to form a trough as it tests 18.32 support. MACD remains bearish and is currently trending down at -50 with no signs of trough formation, it is still technically testing -43.84 support; if it loses this support then the next support (minor) is at -76.22 and would likely coincide with the uptrend line from March 2020. ADX is currently trending up slightly at 21 as Price continues falling, this is mildly bearish.
If Price is able to bounce here then it will likely test $3938 minor resistance . However, if Price breaks down below this level then it will likely retest $3706 minor support before potentially going lower to test $3508 minor support . Mental Stop Loss: (one close above) $3938.
SPX Daily TA Cautiously BearishSPXUSD Daily guidance is cautiously bearish. Recommended ratio: 35% SPX, 65% Cash.
* BOUNCE WATCH . All eyes are on the big FOMC statement at 2pm on 09/21. The big volatility and volume surge today was largely due to a whopping $3.2t OpEx (options expiration) . The UofM Consumer Sentiment Index for September came in at 59.5 compared to 58.2 in August, reflecting a slightly more optimistic consumer heading into Q4. Equities, Cryptos, Futures, US 10Y Treasury, DXY and Agriculture Commodities are all down or flat while VIX, 30Y Treasury, EURUSD, Precious Metals and Oil are up. Key Upcoming Dates: US August Building Permits and Housing Starts at 830am EST 09/20; 13th GDPNow US Q3 GDP estimate 09/20; FOMC meeting 09/20-09/21 (Statement Released at 2pm EST on 09/21); S&P US September Manufacturing PMI at 945am EST 09/23.*
Price finished the day at $3873 after briefly testing the lower trendline of the descending channel from August 2021 (~$3850) as support. Volume is High (high) was the highest since 06/17/22 due to a massive OpEx and favored sellers for a second consecutive session today. Parabolic SAR flips bullish at $4100, this margin is mildly bullish at the moment. RSI is currently trending down below the uptrend line from 01/27/22 at ~40 and testing 38 support with no signs of trough formation; the next support is at the uptrend line from August 2015 (~32). Stochastic remains bearish and is currently trending down at 26, the next support is at 18.32. MACD is currently testing -43.84 support with no signs of trough formation after a rejected bullish crossover attempt at the weak uptrend line from March 2020 (-22) as support; if -43.84 support doesn't hold then the next support is the strong uptrend line from March 2020 at -76.22 minor support. ADX is trending up slightly at 20 as Price continues to fall, this is mildly bearish at the moment.
If Price is able to bounce here then the next likely target is a retest of $3938 minor resistance . However, if Price continues to fall here, it will likely formally retest the lower trendline of the descending channel from August 2021 at ~$3850 as support before potentially retesting $3706 minor support . Mental Stop Loss: (two consecutive closes above) $3938.
SPX Daily TA Cautiously BearishSPXUSD Daily cautiously bearish. Recommended ratio: 35% SPX, 65% Cash.
*August CPI surprised to the upside by increasing 0.1% to finish 8.3% higher than the year before compared to 8.1% consensus estimates, sending Equities, Cryptos, Commodities, Euro and Futures into the red. Today's winners are once again a combination of DXY, US Treasuries and VIX. Although it was minor, CPI going up rather than down is still a blow to the "inflation has peaked" crowd and is likely to inspire the Fed to go with a 75bps (or potentially higher) FFR hike on 09/21. Key Upcoming Dates: The Merge (Ethereum) at ~11pm EST 09/14 ; US August Retail Sales at 830am EST 09/15; 12th GDPNow US Q3 US GDP estimate 09/15; UofM Consumer Sentiment Index at 10am EST 09/16; FOMC meeting 09/20-09/21 (Statement Released at 2pm EST on 09/21).*
Price is currently trending down at ~$3960 as it breaks below the 50 MA at ~4k support and is on the verge of testing $3938 minor support. Volume remains Moderate (high) and is on track to break a four day streak of buyer dominance if it can close today's session in the red. Parabolic SAR flips bearish at $3911, this margin is bearish at the moment. RSI is currently trending down at 42 after being rejected by 53 resistance, the next support is the uptrend line from 01/27/22 at 38 support. Stochastic remains bullish but is currently trending down at 65 after forming a peak just below 76 resistance at 68, if it breaks below 60 it would be a bearish crossover; the next support is at 48. MACD remains bearish as it continues testing the uptrend line from March 2020 at ~-23 and is currently trending down at -26; if support from the uptrend line is lost, the next support is at -11.45. ADX is currently trending down slightly at 20 as Price is falling, this is neutral at the moment; if ADX can form a trough as Price continues to fall, this would be bearish.
If Price is able to bounce off of $3938 minor support then it will likely retest the 50 MA at ~$4k psychological resistance . However, if Price breaks down below $3938 minor support , it will likely retest the lower trendline of the descending channel from August 2021 at ~$3860 as support . Mental Stop Loss: (two consecutive closes above) $4k.
SPX Daily TA Cautiously BullishSPXUSD Daily cautiously bullish. Recommended ratio: 70% SPX, 30% Cash.
*Equities Futures, Precious Metals, EURUSD and Cryptos are up slightly while DXY and US Treasuries are down before market open this week. All eyes will be on August CPI this Tuesday, if it comes in at consensus (8.1%) or lower, markets will likely rally in the near term; however, in the event that CPI surprises to the upside, it's reasonable to expect a reactionary sell-off. Key Upcoming Dates: August CPI at 830am EST 09/13; The Merge (Ethereum) at ~8pm EST 09/14; US August Retail Sales at 830am EST 09/15; UofM Consumer Sentiment Index at 10am EST 09/16; FOMC meeting 09/20-09/21 (Statement Released at 2pm EST on 09/21).*
Price is currently trending up at $4067 as it attempts to break above the 50 MA at ~$4030; the next resistance is at $4175. Volume remains Moderate (high) and has favored buyers in the last three sessions. Parabolic SAR flips bearish at $3890, this margin is neutral at the moment. RSI is currently trending up at 51 as it approaches a retest of 52.68 resistance. Stochastic remains bullish and is currently testing 48 resistance with no signs of peak formation, the next resistance is at 76. MACD remains bearish and is currently trending up slightly at -30 as it attempts to form a bullish crossover by getting above ~-15.50 (which coincides with -11 resistance). ADX is currently trending down at 20 as Price is pushing higher, this is mildly bearish at the moment.
If Price is able to flip 50 MA resistance to support at ~$4030 then the next likely target is a retest of $4175 resistance . However, if Price breaks back down below the 50 MA at ~$4030, it will likely retest $3938 minor support . Mental Stop Loss: (two consecutive closes below) $4030.
SPX Daily TA Cautiously BearishSPX Daily cautiously bearish. Recommended ratio: 15% SPX, 85% Cash.
* BOUNCE WATCH . Equities and Cryptos continue to sell off in favor of DXY and US Treasuries as Russia halts the Nordstream natural gas pipeline indefinitely (renewing fears of a brutal European winter energy crisis). Key Upcoming Dates: 10th GDPNow US Q3 GDP Estimate at 830am EST 09/07 ; 6th Beige Book at 2pm EST 09/07 ; August CPI at 830am EST 09/13; The Merge (Ethereum) at 8am EST 09/14; FOMC meeting 09/20-09/21 (Statement Released at 2pm EST on 09/21).*
Price is currently trending down at ~$3908 as it risks losing $3938 minor support; the next support is the lower trendline of the descending channel from August 2021 at ~$3875. Volume is currently Moderate (high) and is on track to favor sellers for a second consecutive session if it closes today in the red; if this happens then sellers will have dominated six of the last seven sessions. Parabolic SAR flips bullish at $4065, this margin is mildly bullish at the moment. RSI is currently trending sideways at 35 after being rejected by the uptrend line from 01/27/22 as resistance at 38 resistance, the next support is the uptrend line from August 2015 at ~31. Stochastic remains neutral and continues to trend sideways at max bottom for what is now seven consecutive sessions. MACD remains bearish and is currently trending down at -36 with no signs of trough formation, the next support is at -44. ADX continues to trend sideways at 24 for a twelfth consecutive session as Price continues to see selling pressure, this is neutral at the moment.
If Price is able to bounce here then it will have to turn $3938 minor resistance back to support before it can continue higher to retest the 50 MA as resistance at $4k psychological resistance . However, if Price continues to break down here, it will likely retest the lower trendline of the descending channel from August 2021 at ~$3875 as support . Mental Stop Loss: (two consecutive closes above) $3938.
DXY Daily TA Neutral BullishDXY Daily neutral with a bullish bias. Recommended ratio: 60% DXY, 40% Cash.
*After briefly touching $110 minor resistance in Friday's session, the DXY will attempt to retest the next resistance between $112 (Weekly resistance) and $114 (Daily resistance). The last time the DXY tested $112 Weekly resistance was in 2000. If the Fed raises FFR by 75bps on 09/21 this will push it to 3% and may serve as a catalyst for DXY to keep surging higher. A few Fed members have openly suggested taking FFR to 4% or above by early 2023, should this happen the stage is all but set for DXY to keep going higher. Key Upcoming Dates: 10th GDPNow US Q3 GDP Estimate at 830am EST 09/07 ; 6th Beige Book at 2pm EST 09/07; August CPI at 830am EST 09/13; FOMC meeting 09/20-09/21 (Statement Released at 2pm EST on 09/21).*
Price is currently retesting $110 minor resistance for the first time in 20 years. Parabolic SAR flips bearish at $108, this margin is mildly bearish. RSI is currently trending down slightly at 68 after peaking at 69, the next resistance is at 82 and the next support is at 59. Stochastic remains bullish for a second consecutive session and is currently trending up at 91, it's still technically testing 88 support. MACD remains bullish and is currently trending up at .82 but is still technically testing .65 resistance, if it can break above .65 the next resistance is at 1.24. ADX is trending up slightly at 28 as Price continue to push higher, this is bullish.
If Price is able to break above $110 minor resistance then it will likely retest between $112 Weekly resistance and $114 Daily resistance for the first time since 2000. However, if Price breaks down here, it will likely retest $108 support before potentially retesting the 50 MA at ~$107 as support . Mental Stop Loss: (one close below) $108.81.
SPX Daily TA Cautiously BearishSPXUSD Daily cautiously bearish. Recommended ratio: 15% SPX, 85% Cash.
*BOUNCE WATCH. Equities continued to take a plunge today as Cleveland Fed President Loretta Mester mentioned that she would like to see rates above 4% by year end and for most (if not all) of 2023. In one of my previous analyses I incorrectly mentioned that only three Fed members voted on Federal Funds Rate (FFR), it is in fact 12 Fed members (the 7 governors, the New York Regional Fed President and then 4 alternating Reserve Bank Presidents) which comprise the FOMC and vote on FFR. Loretta Mester is one of them. Markets are eagerly waiting to see the August Unemployment Rate in Friday's Jobs Report, if it comes in flat or lower, 75bps will likely become the preferred option come 09/21. However, if there is an uptick in Unemployment a 50bps rate-hike on 09/21 would still likely be on the table. Additional guidance will be provided by August's CPI on 09/13. Key Upcoming Dates: 9th GDPNow US GDP estimate at 10am EST 09/01 ; August Employment Situation 830am EST 09/02; August CPI at 830am EST 09/13.*
Price is currently trending down at $3954 (after breaking below the 50 MA at $4k psychological support) and is technically retesting $3938 minor support. Volume is High and has favored sellers for four consecutive sessions, this is mildly bullish because of the . Parabolic SAR flips bullish at $4190, this margin is mildly bullish at the moment. RSI is currently trending down at 37 and is technically testing the uptrend line from 01/27/22 at 38 support. Stochastic remains bearish and is currently testing max bottom. MACD remains bearish and is currently trending down at -5 with no signs of trough formation as it quickly approaches a test of -11.45 support (which would likely coincide with the uptrend line from March 2020). ADX remains trending sideways at 23 as Price continues to fall, this is neutral at the moment.
If Price is able to bounce off of $3938 minor support then it will likely retest the 50 MA as resistance at ~$4k psychological resistance . However, if Price breaks down below $3938 minor support , it will likely retest the lower trendline of the descending channel from August 2021 at ~$3880 as support . Mental Stop Loss: (two consecutive closes above) $4k.
SPX Daily TA Cautiously BearishSPXUSD Daily cautiously bearish. Recommended ratio: 25% SPX, 75% Cash.
*Equities, Equity Futures and Gold are all slightly down to start the week while Cryptos, VIX, Energy and US Treasuries are up and DXY has stayed relatively flat. The Risk-Off reaction to Jerome Powell's hawkish comments in Jackson Hole last Friday is continuing into the start of this week. Financial markets will likely stay choppy leading up to the Jobs Report on on September 2nd and CPI on September 13th; both of these data points will provide guidance regarding whether the Fed will increase FFR by 50bps or 75bps on September 21st. Meanwhile Europe is facing what is likely to be a cold winter marked by energy rations and high prices, this is something to keep an eye on as it has the potential to exacerbate global recession fears. Key Upcoming Dates: August Consumer Confidence Index at 10am EST 08/30 ; 9th GDPNow US Q3 GDP estimate at 10am EST 09/01; August Employment Situation 830am EST 09/02.*
Price is currently trending down at ~$4050 after breaking below the uptrend line from 06/16/22 at ~$4145, it's fast approaching a retest of the 50 MA at ~$4k as support. Volume remains Moderate (high) and is on track to favor buyers in today's session, after favoring sellers in last Friday's, if it can close today's session in the green. Parabolic SAR flips bullish at $4254 minor resistance, this margin is neutral at the moment. RSI continues to trend down at 43 as it approaches a retest of the uptrend line from 01/27/22 at 38 support. Stochastic is currently neutral and trending sideways at 10, the next resistance is at 18 and the next support at max bottom. MACD remains bearish and is currently trending down at 23 with no signs of trough formation as it still technically is testing 33 support. ADX is currently beginning to form a trough at 23 as Price continues to fall, this is neutral at the moment.
If Price is able to bounce here then it will likely see a bit of resistance at $4100 before it aims to retest $4175 resistance . However, if Price continues to fall here, it will likely retest the 50 MA at ~$4k psychological support and potentially lower to retest $3938 minor support . Mental Stop Loss: (two consecutive closes above) $4100.
SPX Daily TA Neutral BearishSPXUSD Daily neutral with a bearish bias. Recommended ratio: 47% SPX, 53% Cash .
*I incorrectly mentioned that PCE numbers would be released today, they are scheduled for release tomorrow at 830am EST. The 2nd US Q2 GDP estimate was reported today at -0.6% compared to the previous Advanced estimate of -0.9% , the third and final Q2 estimate will be reported on 09/29/22. Equities, Cryptos and Energy are up while VIX, DXY, US Treasuries and Commodities (aside from Energy) are all down or flat. St. Louis Fed President James Bullard made a pitch for more frontloading to bring down inflation and mentioned that he'd like to see EOY FFR at 3.75%-4%. Bullard isn't a voting member on the rates but his view could gain momentum depending on tomorrow's July PCE report and August's Jobs + CPI numbers. The Risk-On appetite seems to be growing ahead of the anticipated speech by Jerome Powell at Jackson Hole tomorrow. Market consensus is that Powell will remain hawkish but tomorrow's PCE numbers may inspire a more dovish tone regarding end of year expectations. Key Upcoming Dates: US July PCE at 830am EST 08/26 ; UofM Final August Sentiment Survey Index at 10am EST 08/26 ; Jackson Hole Economic Symposium on 08/25-08/27 (Fed Chair Jerome Powell scheduled to speak at 10am EST on 08/26).*
Price is currently trending up at $4199 and is still technically testing $4175 support. Volume remains Moderate (high) and has favored buyers in both of the last two sessions as Price tests $4175 support. Parabolic SAR flips bullish at $4290, this margin is neutral at the moment. RSI is currently trending up at 56.73 after forming a trough at, and bouncing off of, 52.68 support. Stochastic crossed over bullish in today's session and is currently trending up at 12 as it approaches 18.32 resistance. MACD remains bearish and is currently beginning to form a trough at 55.35 minor support. ADX is currently beginning to form a trough at 25 as Price is pushing higher, this is mildly bullish at the moment.
If Price is able to close above $4175 in tomorrow's session, it will likely retest $4254 minor resistance before potentially retesting the upper trendline of the descending channel from November 2021 at ~$4300 as resistance . However, if Price breaks down here, the next likely target would be a retest of the uptrend line from 06/16/22 at ~$4100 as support . Mental Stop Loss: (two b2b closes above) $4175.
Nifty level tomorrow We see today a good buy in nifty if we calculate total move of nifty thn nifty can move more thn 300 points today now what for Tomorrow?? We see today close of nifty was below 17597 (17577) we make our Tomorrow view was bearish due to closing now we are bullish in nifty / buy nifty above 17597 bcs if it break this level thn it make a good bullish head &shoulder after that our target 17635 17691 17744
Sl 17575
Sell nifty below 17559
Target 17520 17490 17455
Sl 17600
See our view was bearish for opening bcz of closing if it crossed the level of 17597 thn we are bullish but before that we are bearish
SPX Daily TA Neutral BullishSPXUSD Daily neutral with a bullish bias. Recommended ratio: 55% SPX, 45% Cash.
* The Fed Minutes confirmed preexisting knowledge that inflation is still the primary concern for the economy (making this release a low impact event) and that more downsizing of the Fed balance sheet + another 50bps is the baseline scenario for the next FOMC meeting on 09/21. Fed Staff (FOMC) agreed that 3.4% is the current peak target rate for FFR, the current range is 2.25%-2.5% implying that perhaps two 25bp rate hikes will follow September's anticipated 50bps hike to end the year. Some participants (Fed members) commented on how commodities (primarily energy and food) are likely to keep inflation up in the near term, some Participants mentioned that the policy adjustments are already seeing a substantial effect but almost all agreed that most of the effects haven't been felt yet, and most participants agreed that they support rate hikes until PCE is closer to the 2% long-run target. July US Retail Sales stayed roughly the same as in June and posted ~0% change compared to estimates of 0.1% (sales are still up 9.2% from July 2021), this surprised many analysts who expected more spending with the recent significant reduction in gas prices. Key Upcoming Dates: S&P US August PMI at 945am EST on 08/23; US Q2 Final GDP Estimate at 830am EST 08/25; US July PCE at 830am EST 08/26; UofM Final August Sentiment Survey Index at 10am EST 08/26; Jackson Hole Economic Symposium on 08/25-08/27.*
Price is currently testing $4254 minor support after being rejected by the upper trendline of the descending channel from November 2021 + the 50 MA at ~$4325. Volume remains consistently Moderate and broke a three day streak of buyer dominance with a seller dominated close in today's session; this was a capitulation type of initial reaction which is indicative of a critical resistance. Parabolic SAR flips bearish at $4220, this margin is bearish. RSI is currently testing 68.42 support after forming a soft peak at 73. Stochastic is bearish and currently trending down at 87; it remains in the 'bullish autobahn zone' which is mildly bullish at the moment. MACD remains bullish but is beginning to trend sideways as it forms a soft peak just above the ATH (91.78) at 93.54; it has been bullish for 54 days now, implying that perhaps this is more than just a bear market rally. ADX is currently trending up at 31 as Price continues to push higher, this is bullish at the moment.
If Price is able to bounce here at $4254 minor support then it will likely retest the upper trendline of the descending channel from November 2021 + the 50 MA at ~$4300 as resistance . However, if Price loses $4254 minor support , it will likely retest $4175 support before potentially retesting the uptrend line from 06/16 at ~$4k psychological support. Mental Stop Loss: (one close below) $4226.
SPX Daily TA Cautiously BullishSPXUSD Daily cautiously bullish. Recommended ratio: 75% SPX, 25% Cash . *The BLS reported PPI numbers this morning and they followed in the footsteps of CPI by coming in lower than the month prior, from a 1% rise in June to a -0.5% drop in July. This was a surprise because consensus estimates had PPI rising by 0.2%, such a dramatic fall can largely be attributed to the 19% decline in national average retail gas prices since last month. Year over year, PPI registered its lowest rise from the 12 months prior at 7.6% (this is the lowest it's been since October 2021). This inflation data has markets believing that inflation has peaked and July's PCE numbers due on 08/26/22 will help to clarify whether the drawdown in inflation was largely due to a big pullback in gas prices. June's PCE numbers came in higher than estimates and, all things considered, the supply chain situation has only improved nominally which brings a bit of uncertainty regarding whether or not PCE will follow in the footsteps of CPI and PPI. Key dates next week: US Housing Starts and Building Permits at 830am EST 08/16; 5th GDPNow US Q3 GDP estimate at 915am EST 08/16 ; US Retail Sales at 830am EST 08/17.* Price is currently testing $4254 minor resistance (new resistance) after breaking out above $4175 resistance and flipping it to support (two consecutive closes above $4175). Volume remains Moderate and has favored sellers in three of the past four sessions even as Price is going higher, this is mildly bearish at the moment. Parabolic SAR flips bearish at $4109, this margin is mildly bearish. RSI is currently trending down at 67 after being rejected at 68.42 resistance, the next support is at 53. Stochastic is currently crossing over bullish at 91, the next resistance is max top while the next support is at 76. MACD remains bullish for a 48th consecutive session and is currently beginning to form a soft peak at 74, the next support (minor) is at 55 and the next resistance is the ATH at 91.78. ADX is currently trending up at 25 as Price is pushing higher, this is bullish. If Price is able to break out above $4254 minor resistance then the next likely target is a retest of the upper trendline of the descending channel from November 2021 at ~$4300 as resistance (which would probably coincide with the 200 MA). However, if Price is rejected here, it will likely formally retest $4175 support . Mental Stop Loss: (two consecutive closes) below $4175.
DXY Daily TA BearishDXY Daily bearish. Recommended ratio: 5% DXY, 95% Cash . *Treasuries (excluding the 30 yr Bond) and the Dollar are correcting after a bullish summer fueled by supply chain woes and recession fears. Supply chain woes have not been remediated but there is an element of the Bullwhip Effect that should be considered and that is the excess supply that can come shortly after an abrupt slow down in demand, this could lead to deflation which would naturally (yet artificially) reduce inflation. The recessionary fears on the other hand are starting to wane with every remotely bullish economic data point that is reported, speculators are even already betting on a 50bps rate hike in September. Just today Minneapolis Fed President Neel Kashkari stated that he would like to see EOY FFR at 3.9% and 4.4% by the end of 2023, he doesn't actually have a final vote on this but it's worthy of mention considering he has been rather dovish in recent years. Both money markets and Fed members have acknowledged that the EOY target for FFR in 2022 is 3.25%-3.75% (technically 3.15%-4%), so if the current range is 2.25%-2.5% (current effective rate is 2.3%) it would require 100bps or more over the next three Fed meetings in September, November and December to get to 3.25%-3.75% EOY FFR. As of now the most likely scenarios are: September 50-75bps, November 50-75bps and December 25-50bps. More clarity will arrive at the end of this month with PCE numbers due on 08/26 and the Jackson Hole Economic Symposium on 08/25-08/27. In other news, Disney reported beats on Q3 earnings and revenue but forecasted slower subscriber growth in 2024. Key dates remaining this week: PPI report at 830am EST 08/11 .* Price was rejected by the descending trendline from 07/14/22 and is currently trending down at ~$105.20; it is still technically testing the 50 MA as support at ~$105.58. Parabolic SAR flips bullish at $106.87, this margin is mildly bullish at the moment. RSI is currently trending up slightly at 43 after bouncing at 39 and is still technically testing the uptrend line from July 2020 as support at ~45. Stochastic remains bearish for a third session and is currently testing 24 support with no signs of trough formation. MACD remains bearish and is currently testing 0 support with no signs of trough formation, if it breaks through this support then the next support is at -0.38. ADX is currently beginning to form a trough at 21 as Price continues, this is mildly bearish; if ADX can start trending up as Price continues to fall this would be bullish. If Price is able to defend support at the 50 MA (~$105.58) then it will have to break above the descending trendline from 07/14/22 at ~$105.75 in order to retest $108 resistance . However, if Price continues to break down here, it will likely retest $103 support . Mental Stop Loss: (two consecutive closes above) $105.70.
SPX Daily TA Neutral BearishSPXUSD Daily neutral with a bearish bias. Recommended ratio: 40% SPX, 60% Cash . * CRITICAL RESISTANCE WATCH . Equities finished the session relatively flat as markets are sending mixed signals ahead of CPI and PPI data on 08/10 and 08/11. Crypto, Gold, VIX and Oil are trending higher while DXY and Treasuries are down. Palantir reported an earnings miss and revenue beat and forecasted weaker revenue guidance for the second half of 2022; this likely isn't a market moving event but is important because it not only reflects a slowdown in growth stock interest but it hints at a slowdown in economic activity ( due to their significant number of government contract delays ). Key dates this week: COIN earnings 08/09; 4th US Q3 GDP estimate at 10am (EST) 08/10 ; CPI at 830am (EST) 08/10 ; Disney earnings 08/10; and PPI at 830am (EST) 08/11 .* Price continues to retest $4175 major resistance and briefly broke above it in today's session. Volume remains Moderate and fairly balanced between buyers and sellers reaffirming that Price is trading at a critical resistance. Parabolic SAR flips bearish at $4060, this margin is mildly bearish. RSI is currently trending down slightly at 63 after peaking at 66, it is also exhibiting minor Bearish Divergence; the next resistance is at 68 and next support at 53. Stochastic is currently crossing over bearish at 92 as it continues to trend sideways in the 'bullish autobahn'; the next support is at 76. MACD is currently beginning to form a soft peak at 68 and is still technically testing 55 minor resistance. ADX is currently trending up at 22.50 as Price continues its attempt to break above $4175, this is mildly bullish. If Price is able to bounce here then it will need to close above $4175 major resistance for two consecutive sessions in order to flip it to support; only after this will it be able to retest the upper trendline of the descending channel from November 2021 at ~$4300 as resistance . However, if Price breaks down here, it will likely retest $4100 before potentially retesting the uptrend line from 06/16/22 at $4k psychological support . Mental Stop Loss: (two consecutive closes above) $4175 .
SPX Daily TA Neutral BearishSPXUSD Daily neutral with a bearish bias. Recommended ratio: 45% SPX, 55% Cash. * JOBS REPORT WATCH . The Employment Situation is released tomorrow (08/05) at 830am (EST) and markets seem to be rallying as if unemployment is going to stay flat or go up insignificantly. If this scenario plays out, it will be interesting considering labor force participation continues to trend down from March , weekly jobless claims went up , there's been a notable increase in layoffs over the past few months and many corporations announced they are going to slow hiring through the end of the year. Equities continue their rally with the S&P posting its biggest bounce of the year (13%) since its June 16th low, reflecting that consumer sentiment regarding inflation, supply chains, FFR and Russia/China is very optimistic heading into 2023. Yesterday, OPEC+ agreed to raise output by 100,000bpd starting in September, compared to the ~600,000bpd increases in July and August this sent the price of Oil back up heading into September; which is likely to result in more inflationary pains for consumers. Taiwanese news agencies have reported that China has been conducting the closest military drills yet and have launched a record number of cyberattacks at Taiwan since Pelosi's visit . Blackrock will be offering crypto to their ~200 institutional investors through Coinbase Prime and Coinbase partnered with Meta to allow for NFTs to be shared on Instagram from Coinbase Wallet ; both of these reports sent COIN up 45% in today's session and probably made Cathie Wood shite her pant$ after selling 1.133m shares at ~$55 last week (Price is currently ~$88). The Atlanta Fed released their third Q3 GDP estimate and it came in higher than the last going from 1.3% to 1.4%. Apparently today the White House joined the WHO in labeling Monkeypox a public health emergency . Key dates: July Jobs Report at 830am (EST) 08/05; July CPI at 830am (EST) 08/10; 4th Atlanta Fed Q3 GDP Estimate 08/10; July PPI at 830am (EST) 08/11.* Price is currently testing $4175 resistance as it awaits the Jobs Report tomorrow morning. Volume remains Moderate (high) and has favored sellers in two of the past three sessions, indicating that $4175 resistance is seeing quite a bit of selling pressure. Parabolic SAR flips bearish at ~$4k (-3% from current Price), this margin is mildly bearish. RSI is trending down slightly at 65 after forming a peak at 66, this is currently exhibiting mild Bearish Divergence from Price; a potential Double Top formation is also forming just below 68 resistance which is something to watch for. Stochastic remains bearish but is currently attempting to cross over bullish at 93; the next support is at 76. MACD remains bullish for the 41st consecutive session and is currently trending up at 65 with no signs of peak formation; it is still technically testing 55 minor resistance. ADX is currently trending up at 22 as price pushes higher, this is mildly bullish. If Price is able to break above $4175 resistance then it will likely retest the 200 MA + the upper trendline of the descending channel from November 2021 at ~$4300 . However, if Price is rejected here, it will likely retest $4100 before potentially retesting the uptrend line from 06/16/22 at $4k psychological support . Mental Stop Loss: (two consecutive closes above) $4175.
SPX Daily TA Neutral BearishSPX Daily neutral with a bearish bias. Recommended ratio: 48% SPX, 52% Cash. * NANCY PELOSI WATCH. S&P Global released their final July US Manufacturing PMI estimate this morning and it came in at 52.2, slightly lower compared to both June's PMI and the consensus estimate of 52.3; this is the lowest it has been since July 2020. The Atlanta Fed released their second GDPNow Q3 estimate today and it came in at +1.3%, down from the initial estimate of +2.1% on 07/29/22. According to Reuters, CNN and 'Taiwanese media', Nancy Pelosi is scheduled to visit Taiwan tomorrow against the wishes of the PRC; though military countermeasures have been promised but are not expected, if this does happen it would surely shake up markets due to the uncertainty regarding how mainland China will respond. Key dates remaining this week: Nancy Pelosi potentially visiting Taiwan tomorrow night (08/02) and speaking to lawmakers and human rights groups on Wednesday (08/03); St. Louis Fed President James Bullard speaks @ 645pm EST (08/02); Cleveland Fed Loretta Mester speaks 12pm EST (08/03); July BLS Employment Situation @ 830am EST (08/04).* Price is currently facing some selling pressure at ~$4120 as it aims to retest $4175 resistance. Volume is Moderate and on track to favor buyers for a fourth consecutive session if it can close today in the green. Parabolic SAR flips bearish just below the 50 MA at $3900. RSI is currently trending down slightly at 65 after forming a peak at 66 (just below 68.42 resistance); Hidden Bearish Divergence between Price and RSI can be seen from 06/02/22, this is significant due to the potential local Double Top formation. Stochastic remains bullish but is trending down at 98.5 after testing max top for the first time in ten sessions; if it breaks below 93.5 it would be a bearish crossover. MACD remains bullish for the 38th consecutive session and is currently trending up at 49.50 as it approaches 55 minor resistance with no signs of peak formation. ADX is currently trending up at 19 as Price pushes higher, this is mildly bullish. If Price is able to push higher then it will likely formally retest $4175 resistance where it may see a bit of selling pressure. However, if Price breaks down here, it will likely retest the uptrend line from 06/16/22 as support at ~$4k . Mental Stop Loss: (one close above) $4175.
SPX Daily TA Cautiously BullishSPX Daily bullish. Recommended ratio: 88% SPX, 12% Cash. * CRITICAL RESISTANCE WATCH . The BEA reported June PCE numbers this morning and both came in higher than last month: Core PCE (sans Food and Energy) came in at 4.8% vs 4.7% last month (also had a 4.7% consensus estimate) and PCE Index came in at 6.8% (20 year high) vs 6.3% in the previous two months. Although the move in Core PCE wasn't too significant, it's the Fed's preferred gauge of inflation which leaves the possibility of a 75bps hike in September on the table. BLS reported Q2 ECI numbers and compensation stayed relatively flat while wages/salaries increased and benefits decreased compared to Q1, this is perhaps indicative of businesses cutting perks and profit sharing in exchange for higher wages to lure in talent during an inflation induced consumer slowdown. Compensation, Wages/Salary and Benefits all went down for State and Local Government employees. The U of M Sentiment Survey came in at 51.5, a 3% gain from last month's (50); if next month's is higher, this would imply that consumers are becoming more optimistic about the worst being behind us in 2022. The Atlanta Fed posted their first GDPNow Q3 estimate and to the surprise of many they anticipate a quarter of +2.1% GDP growth. Earnings this quarter are so far proving to be resilient as well and provide additional confidence for investors going into Q3. Equities, Cryptos, Gold and Oil are up while VIX, DXY, and Treasuries are down as more investors begin to transition to risk-on with hopes that the worst is behind us. Though I still think it's premature to assume money markets have bottomed until after September, there is a lot of upside potential here compared to downside.* Price is continuing the FOMC rally and is currently trending up at $4130 as it approaches a test of $4175 resistance (which is a critical resistance). Volume remains Moderate (high) and is on track to favor buyers for a third consecutive session if it can close today in the green. Parabolic SAR flips bearish at $3862, this margin is mildly bearish at the moment. RSI is currently trending up and beginning to form a soft peak at 66 as it approaches 68.42 resistance. Stochastic remains bullish and is currently trending up at max top. MACD remains bullish and is currently breaking above 33 resistance and trending up at 42.65 with no sign of peak formation, the next resistance is at 55. ADX is currently trending up at 18 as Price is pushing higher, this is bullish. If Price is able to continue up here then it will likely test $4175 major resistance before potentially testing the upper trendline of the descending channel from November 2021 at ~$4300 as resistance . However, if Price breaks down here, it will likely test $4k psychological support before potentially retesting $3938 minor support . Mental Stop Loss: (one close below) $4k.
DXY Daily TA Cautiously BearishDXY Daily cautiously bearish. Recommended ratio: 25% DXY, 75% Cash. * US Treasury Secretary Janet Yellen was interviewed by NBC and explained that due to strong consumer demand, credit quality and employment, the widely anticipated two consecutive quarters of negative GDP would not constitute a recession. She is essentially the White House mouthpiece for the state of the economy and is saying that a healthy labor market and a strong consumer (she's referring to growing retail sales, positive GDI growth and "healthy" consumer credit) are currently saving the US from an economic recession. The Consumer Confidence Index (the leading gauge of US consumer confidence) is scheduled to report tomorrow (07/26) at 10am (EST), it has fallen for the past two months and is now at the lowest level since February 2021. The University of Michigan Consumer Sentiment Index is currently projecting a rise in confidence from June to July and is scheduled to report at 10am (EST) on 07/29. With increases in layoffs and announced slowdowns in hiring I'm legit curious to know how the Employment Situation looks on 08/05; both the Federal Reserve and the US Treasury Department are notorious for relying upon lagging data, time will tell if this is one of those cases. With regards to the DXY there are two bullish catalysts at work here: 1) continued geopolitical turmoil and the resulting supply chain disruptions (leading to food and energy shortages) are pushing investors to US treasuries and 2) increases to FFR spillover into increases to overall economic rates, which typically push those looking for higher rates of return to dollar-denominated assets which in return pushes DXY higher. The current consensus on the EOY FFR from both money markets and FOMC members is around 3.25-3.5%, we are currently at 1.5%-1.75% (effective is currently 1.58%). That said, if the projected increases in FFR are to in fact take place AND the global geopolitical/supply chain situation continues to worsen, it would be reasonable to see DXY at 2000-2002 levels (~$120). Reminder that there was a "technical" US recession from March 2001 to November 2001.* Price is continuing to trend down at ~$106.50 after being rejected by $108 resistance; it is also forming a Bull Flag and may attempt to retest $108 resistance in the near term. Parabolic SAR flips bullish at $108.57, this margin is neutral at the moment. RSI is currently trending down at 52 and is beginning to form a soft trough after getting rejected by 59 resistance; the next support is the uptrend line from July 2020 at ~45. Stochastic remains bearish and is currently forming a trough as it attempts to cross over bullish at max bottom. MACD remains bearish and is currently testing 0.65 support with no sign of trough formation. ADX is currently trending down at 34 with no sign of trough formation as Price continues seeing selling pressure, this is mildly bearish at the moment. If Price is able to bounce here at ~$106.50 then it will likely retest $108 resistance . However, if Price continues to break down, it will likely retest the 50 MA (for the first time since May) at ~$105 . Mental Stop Loss: (one close above) $108.
DXY Daily TA Cautiously BullishDXY Daily cautiously bullish. Recommended ratio: 75% DXY, 25% Cash. *Demand for USD continues as global recessionary fears amplify and tighter monetary policy pushes investors to short term Treasuries (Yield Curve inversion). The Euro is maintaining parity with the USD for the third consecutive day as Italy's Prime Minister Mario Draghi submitted an offer to resign today . Interestingly, as DXY continues pushing higher to reach levels last seen in 2002 (taking liquidity from Cryptos, Equities and Commodities), markets are currently reacting favorably to Fed Governor Christopher Waller's remarks today about how the markets are "getting a bit ahead of themselves" regarding inflation and that the job market is healthy enough to continue economic expansion. Waller also mentioned that though 75bps is all but guaranteed, he is waiting on June retail sales data ( scheduled for release tomorrow 07/14/2022 at 830am EST ) and housing starts/building permit data ( scheduled for release 07/19/22 at 830am EST ) to determine if demand is still so high that it warrants a full 100bps or more rate hike on 07/27/22. DXY has only traded above $108 in three other periods: 1967-1973 (two recessions 69-70 and 73-75, Nixon "nixed" the Bretton Woods Agreement and Gold Standard in attempt to stimulate the economy and ring in inflation, the third and fourth Arab/Israeli wars, 1973 oil crisis and stock market crash); 1981-1986 (one recession 81-82 after short rate-hike induced recession in 1980, Cold War fears pushed investors to DXY as Russia tested nuclear weapons in Kazakhstan, Iranian Revolution prompted 1979 energy crisis, Fed tightened monetary policy to bring down inflation, stock market only crashed 81-82 and rallied from 83-87); and the only period where CPI was relatively low (below 3.67%) and DXY was above 108 was 2000-2002 (short recession in 2001, Y2K, Dot-Com bubble popped, 9/11). That said, history shows that financial markets mostly tumble and the economy enters a recession as DXY rallies above 108; using this pattern one can surmise that if DXY continues to rip higher, markets may go lower.* Price is currently trending up at $108.63 as it technically tests $108 resistance. Parabolic SAR flips bearish at $106.20, this margin is neutral at the moment. RSI is currently trending up at 76 after bouncing at 73, the next resistance is at 82. Stochastic is currently in the process of crossing over bearish as it trends sideways at 97 in the 'bullish autobahn zone'. MACD remains bullish and is currently trending up at 1.25 as it tests 1.24 resistance with no signs of peak formation; the next support is at 0.64 and resistance at 1.92. ADX is currently trending up at 42 with no signs of peak formation as Price continues to push higher, this is bullish. If Price is able to defend support at $108 then the next likely target is a retest of $115 resistance for the first time since February 2002. However, if Price is rejected here at $108 and breaks down, the next likely target is a retest of the 50 MA at around $103 support . Mental Stop Loss: (two consecutive closes below) $108.
S&P500: No Time to Relax 🥵S&P500 has lived through two exhausting weeks, exploring virtually every level of the blue area between 4698 and 4552 points, and lately going below it on its search for a new low. However, there is no time to relax now! We expect the index to finish wave in blue just below the blue area (and allow him a buffer zone only until 4492 points). Then, it should be full of go again. The following surge should slingshot the index up into the upper blue area between 4992 and 5099 points, where the destination of wave in blue should be located.
However, we have worked out an alternative that is not to be sneezed at! There is a 40% chance that the index could initially go further down if it lingers below the support at 4492 points. It shouldn’t fall below 4269 points though. The trend reversal should take place in the lower blue belt between 4399 and 4293 points and ensure a new rise.
All in all, S&P500 should be ready to go up again before touching the support at 4492 points. Still, with a probability of 40%, it could slide below this mark at first.
