A significant update on Nasdaq today Hello traders,
This is a new update of the NASDAQ market after the release of the data news.Uh uh, that came uh, stagnant stable as expicted 241K, not much happened, but as you can see from the chart, the NASDAQ market really bounced.Off of the 50 moving average and went down a little to stop out traders who were putting their stop losses.Right below the 1 hour level 20300 and that is a trick that institutions, financial and money institutions and funds due in order to stay alone in the market and get rid of all the.Other traders and as I told you before, the market may go down for a correction and still move up since.There is no real impact on the market. I'm pretty sure that the target will be still the daily level that we.Talked about.Earlier, which is?Umm. 20474.And if that level is.Are broken. We should wait for a Pull back and then look for a long trade.to go and seek the next level which will be 20744.So please keep watching that level. As long as we have a bullish momentum, we should look only for a buy trade, not a sell since the four hours. the daily chart are still bullish and there is still a bullish momentum, so we should look for a buy.trade not sell trades. Thank you for your attention and good luck for everyone and take care.
Joblessclaims
U.S. Initial Jobless Claims (Updated Chart with todays release)U.S Initial Jobless Claims
Rep: 187k ✅ Lower Than Expected ✅
Exp: 207k
Prev: 203k (revised up from 202k)
A positive release today with initial claims coming in much lower than expected.
Chart Trend
We are very close to taking out the lows from Oct 2022 at 180k claims on the chart. Importantly these charts do not update with revised figures and factoring in revised data the low was 167k in April 2022 (a little earlier and a little lower).
In any event these sorts of lows in Initial Claims have not been seen since May 1969.
Recession Watch
The chart below has min, avg and max levels on the bottom left to illustrate the levels we would need to hit for increased recession risk. Right now this chart has not demonstrated increased risk. We need be careful and watch for the average increase of 71k pre recession as illustrated on the chart. Lets see what next months reading informs.
Continuous Claims up Next 💪🏻
Continuous Jobless Claims in High Risk Territory U.S. Continuous Jobless Claims
Rep: 1,906k 🚨Higher than Expected 🚨
Exp: 1,889K
Prev: 1,898k (revised down from 1,905k)
Continuous claims came at 1,906k which is 8,000 higher than last weeks revised 1,898k.
The Trend
Since Sept 2022 continuing claims have increased from 1.302m to 1.906m (604k+).
This is significantly concerning trend & suggests that an increasing number of people that have become unemployed are remaining unemployed for longer.
Short Term Trend ~ Weekly Chart - FEATURED CHART
Long Term Chart Trend ~ Monthly Chart - SEE BELOW LINK
Recession Watch
Both charts above have min, avg and max levels on the bottom right to illustrate the levels we would need to hit for increased recession risk.
Right now this chart demonstrates we are at max timeframe and close to max levels for an advance recession warning.
PUKA
Continuous Jobless Claims Continues to IncreaseU.S. Continuous Jobless Claims
Rep: 1,895 🚨 20k HIGHER THAN EXPECTED🚨
Exp: 1,875K
Prev: 1,865k (revised down from 1,871k)
20,000 higher continuous claims than expected. This is keeping the long term trend rising and remains one of thee most concerning charts out there.
Chart Trend
Since Sept 2022 continuing claims increased from 1.302m to 1.895m (593k+).
This is significantly concerning trend and suggests that an increasing number of people that have become unemployed are remaining unemployed for longer.
Recession Watch
For the last 6 Recessions the 2.86m level was surpassed confirming or coinciding with recession initiation (see red dashed line). This is noted as the “Last 6 Recessions Threshold” on the chart. This is a level that was surpassed on confirmation of recession commencement (recessions are in red). The blue levels are pre-recession increases which are the warnings we are trying to interpret to get a lead.
The above chart above has min, avg and max levels on the bottom right to illustrate the levels we would need to hit for increased the pre recession risk. Right now this chart demonstrates we are at max timeframe and close to max levels for an advance recession warning.
PUKA
U.S. Continuing Jobless Claims (Updated Chart & Release)U.S. Continuing Jobless Claims
Rep: 1,806k ✅Lower Than Expected ✅
Exp: 1,845k
Prev: 1,832k (revised down from 1,834)
Whilst the short term lower than expected continuous jobless claims are welcomed the long term trend is one of thee most concerning charts out there.
Chart Trend
Since Sept 2022 continuing claims increased from 1.302m to 1.806m (500k+). This is significantly concerning trend and suggests that an increasing number of people that become unemployed are remaining unemployed for longer.
Recession Watch
The chart below has min, avg and max levels on the bottom right to illustrate the levels we would need to hit for increased recession risk. Right now this chart demonstrates we are at max timeframe and close to max levels for an advance recession warning.
What are Initial and Continuous claims?
Initial Jobless Claims account for only the people that claimed their first week of unemployment benefit whilst Continued Jobless Claims accounts for people who continued to seek their unemployment benefit into week 2 and subsequent weeks.
Next up, Philly Fed Manufacturing Index 💪🏻
Understanding Initial Jobless Claims as a Market IndicatorIntroduction
In the complex and multifaceted world of economic indicators, initial jobless claims hold a special place. As a measure of the number of individuals filing for unemployment benefits for the first time, this statistic offers a real-time glimpse into the health of the labor market, which in turn is a vital component of the overall economic landscape. This article delves into how initial jobless claims function as an indicator and their impact on the financial markets.
Understanding Initial Jobless Claims
Initial jobless claims refer to claims filed by individuals seeking to receive unemployment benefits after losing their job. These are reported weekly by the U.S. Department of Labor, providing a timely snapshot of labor market conditions. A lower number of claims typically signifies a strong job market, suggesting that fewer people are losing their jobs. Conversely, an increase in claims can indicate a weakening labor market, often a precursor to broader economic downturns.
Initial Jobless Claims as an Economic Indicator
Health of the Labor Market: The primary significance of initial jobless claims is its reflection of the labor market's health. A steady, low number of claims often correlates with job growth and declining unemployment rates, indicating a robust economy.
Leading Indicator for the Economy: As a leading economic indicator, jobless claims can provide early signals about the direction of the economy. Spikes in claims can forewarn of economic contraction, while consistent decreases might indicate economic expansion.
Consumer Spending: Since employment directly affects consumer income, initial jobless claims can also indirectly signal changes in consumer spending, a major driver of economic growth.
Impact on Financial Markets
Market Sentiment: Traders and investors closely watch initial jobless claims to gauge market sentiment. Fluctuations in these numbers can lead to immediate reactions in the stock, bond, and forex markets.
Monetary Policy Implications: Central banks, like the Federal Reserve, consider labor market conditions when setting monetary policy. Rising jobless claims can lead to a more dovish policy stance (like lowering interest rates), while decreasing claims might justify tightening policies.
Sector-Specific Implications: Certain sectors are more sensitive to changes in jobless claims. For instance, a rise in claims can negatively impact consumer discretionary stocks but might be favorable for defensive sectors like utilities or healthcare.
Analyzing the Data
Understanding initial jobless claims requires context. Seasonal factors, temporary layoffs, and unique economic events (like a pandemic) can skew data. Analysts often look at the four-week moving average to smooth out weekly volatilities for a clearer trend.
Conclusion
In conclusion, initial jobless claims serve as a crucial barometer for the economy and financial markets. Investors, policy makers, and economists alike monitor these figures for insights into labor market trends and the broader economic picture. As with any indicator, it's essential to consider jobless claims in conjunction with other data to fully understand the economic landscape.
Macro Monday 9~ Initial Jobless Claims MACRO MONDAY 9
Initial Jobless Claims
Historical Analysis and Important upcoming levels
Initial claims are new jobless claims filed by U.S. workers seeking unemployment compensation, included in the unemployment insurance weekly claims report. "Initial claims" refers to the government report on the number of workers applying for unemployment benefits for the first time following job loss
First-time jobless claims can be a useful leading indicator because elevated numbers tend to lead to further economic weakness, and to decline ahead of a recovery
Initial claims show the recent layoffs trend and does not a full picture of the labor market however it can provide more frequent data points indicating the trend in layoffs based on the recent decisions of U.S. employers. The layoffs trend can be particularly telling at economic turning points. With that in mind lets look at the chart and its historic patterns.
The Chart
The chart looks complicated but is incredibly simple and can be summarised as follows.
- Recessions are in red
- Increases to Initial Jobless Claims prior to recessions are in blue
- It is clear that prior to recessions Jobless Claims typically increase but for how long and by
what amount?
- The min/max increase in claims prior to recession is between 35k - 127k
- The min/max timeframe of increasing claims prior to recession is 7 - 23 months
- The average of the above is a 71k claims increase over a 14 month period.
- At present we are below that average at 49k increase over 11 months @ 230,000 claims.
- I have set out levels on the chart for us to monitor going forward in line with the min and
max claims amounts and timelines as above. We can monitor these levels on trading view
going forward just by pressing play and seeing if we are nearing or hitting the indicative
levels.
- Once we reach the average increase amount at 252k or the average timeline of 14 months
in Nov 2023, we are entering into higher risk recession territory.
Currently, the max increase in claims prior to recession is projected to be at the level of 308,000 (based on historic claims) and the max timeframe is out to Aug 2024 (based on historic timeframes) thus indicating that between Nov 2023 and Aug 2024, subject to continued increasing initial claims (above the average level of 252,000) it is probable that there will be a recession within this time window (Not guaranteed). If initial claims fall below their recent low of 200,000 I believe this might invalidate the possibility of a recession or at least have a significant lagging effect on time horizon. At present this outcome seems unlikely but anything is possible and we can monitor this on an ongoing basis.
The current yield curve inversion on the 2/10 year Treasury Spread provided advance warning of recession/capitulation prior to all of the above recessions however it provided us a wide 6 - 22 month window of time from the time the yield curve made its first definitive turn back up to the 0% level (See Macro Monday 2). September will be the 6th month of that 6 – 22 month window and thus we are closing in on dangerous territory very fast.
From reviewing initial jobless claims we can see how from Nov 2023 we are stepping into a higher risk zone on this chart also (subject to continued higher increases in claims). Should we have claims higher than the average of 252,000 we will be confirming another step towards a higher risk of a recession.
Factoring in yield curve inversion and the initial jobless claims we could consider the months of Sept-Oct 2023 as Risk level 1 (yield curve inversion time window opens) and Nov-Dec 2023 as stepping into a higher Risk Level 2 (Jobless claims average timeframe hit). Should the yield curve continue to move up towards being un-inverted and should Jobless Claims increase then Jan 2024 forward could be considered a higher Risk level 3.
Adding to the above concerns is that M2 Money supply is still reducing (Macro Monday 8) and Global Net Liquidity is continuing to reduce (Macro Monday 4) as the S&P 500 is hitting a major resistance zone when accounting for M2 money supply (Macro Monday 8). At present it is clear that liquidity is reducing both globally and in the US. Currently fiscal stimulus appears to be filling the gaps and may be causing additional lagging effects to the changes we have seen imposed by Federal Reserve (balance sheet reduction and increased interest rates). Keep in mind that the Fed is also targeting higher unemployment to help quell the effects of inflation thus adding to the relevance of the Initial Jobless Claims numbers.
Continued jobless claims are another metric that is not covered here today. Continued Jobless Claims accounts for the continuation of claims over a time period, thus indicating that those workers who made the first “Initial claims” have remained unemployed thereafter and have not managed to get new work. We might cover this in a future Macro Monday. Let me know if you want it sooner than later?
We need all the help we can find in managing risk going forward and I hope all these charts can help you with that.
We can monitor all these charts on my trading view just by pressing play and seeing where things are going. Regardless ill be providing updates along the way.
Be safe out there
PUKA
MACRO MONDAY 11~ Cont. Jobless Claims MACRO MONDAY 11
Continued Jobless Claims ECONOMICS:USCJC
Continued Jobless Claims are the continued unemployment benefits claimed by workers who made their first “Initial claim” and remained unemployed in the weeks that followed.
In other words, Initial Jobless Claims account for only the people that claimed their first week of unemployment benefit whilst Continued Jobless Claims accounts for people who continued to seek their unemployment benefit into week 2 and subsequent weeks.
In order to be classified as a continuing claim, an unemployed individual must be unemployed for at least one week after filing an initial claim. They will be removed from the metric when they return to work.
Whilst continuous claims do provide an aggregate of accumulating unemployment numbers over time, initial claims are reported sooner and considered more important to financial markets. Regardless there is a clear historic pattern on the Continued Claims Chart that demonstrates that continued jobless claims increase prior to recessions, and at present we are reaching higher than historical averages that have preceded recessions.
The Chart
The chart can be summarized as follows:
- Recessions are in red
- Increases in Continuous Jobless Claims prior to
recessions are in blue
- It is clear that prior to recessions Continuous
Jobless Claims typically increase but for how long
and by what amount?
- The min/max increase in claims prior to recession is
between 218k - 614k
- The min/max timeframe of increasing claims prior
to recession is 6 – 21 months
- The average of the above is a 424k claim increase
over a 11 month period.
- At present we are now at the avg. 11 months time
period and sit at an increase of 380k, however we
exceeded 520k in continuous claims increases in
Apr 2023. This obviously means since April 2023
continuous claims have reduced however the
reduction is marginal against the larger move.
- I have set out levels on the chart for us to monitor
going forward in line with the min and max claims
amounts and timelines as above. We can monitor
these levels on trading view going forward just by
pressing play and seeing if we are nearing or hitting
the indicative levels.
- If we reach the average increase amount at >424k
AGAIN we are entering into higher risk of recession
territory. We are already in month 11 of increases to
continuous claims which is the average timeframe
prior to a recession commencing. To be exact it is
approx. 11.5 months therefore the 2ndhalf of the
month of September is where we step into a higher
risk level.
Currently, the max increase in claims prior to recession is projected to be at a level of 1.928 million (based on historic claims) and the max timeframe is out to Jun 2024 (based on historic timeframes) thus indicating that between Aug 2023 and Jun 2024, subject to ongoing increasing continuous claims (holding above the average level of 1.734 million) it is probable that there will be a recession within this 11 month time window (Not guaranteed). If continuous claims fall below their minimum historic pre-recession level of 1.51 million I believe this might invalidate the possibility of a recession or at least have a significant lagging effect on time horizon. At present this outcome seems unlikely but anything is possible and we can monitor this on an ongoing basis.
We now have a number of charts demonstrating that from Sept 2023 to Mar/Apr 2024 we have a significantly increased probability of recession. These charts were shared just a few days ago if want to have a look.
These charts are as follows:
1. The current yield curve inversion on the 2/10 year Treasury Spread provided advance warning of recession/capitulation prior to all of the recessions outlined on the below chart however it provided us with a wide 6 - 22 month window of time from the time the yield curve made its first definitive turn back up to the 0% level. Sept 2023 is the 6th month of that 6 – 22 month window. The 22nd month is Jan 2025. The average time before a recession after the yield curve starts to turn up is 13 months or April 2024.
- Based on this chart it is clear that there is
substantially increased recession risk between
Sept 2023 – April 2024.
2. Interest Rate Hike & S&P500 chart (Macro Monday 8). In the event that the Federal Reserve is pausing rates from Sept 2023, historic timelines of major hike cycles suggest a 7 month pause like in 2000 or a 16 month pause in line with 2007 (an avg. of both is c.11 months). For reference COVID-19’s rate pause was for 6 months.
- 6 months from now would be March 2024
and 16 months from now would be Nov 2024. The
average of both Jun 2024.
- Based on this chart it is clear again that there is
substantially increased recession risk between
Sept 2023 – March 2024 of recession,
increasing again thereafter from May onwards.
3. Initial Jobless Claims are currently increasing and are reaching pre-recessionary levels. If initial jobless claims surpasses its historic pre-recession averages of 252,000 of increased claims and if claims continue to increase past Nov 2023, this suggests we are entering into a much higher risk of recession.
- Whilst this chart is not indicating the Sept 2023 to
Mar/Apr 2024 time window as the two charts
above are, it may present a date within that
window of time from Nov 2023 forward (subject
to continued increases).
4. Today’s chart Continuing Jobless Claims suggests
that we have broken past both the increase in claims average of 424k (to 1.734 mln) and we are into month 11 which is the average timeframe of increases prior to recession commencement.
- Todays chart is suggesting we are already in a
recession or have just started into one. Another
breach back above the 1.734 mln level (average
level) would be a good confirmation signal that the
risk of recession remains on the table.
With this in mind it is important to recognize that on average official declaration of recession can be declared up to 8 months after a recession has started, so we should be on the look out for indications of a recession starting (without the official declaration).
Today’s chart and the above charts suggest the following:
1. Significantly increased risk of recession from the 2nd half of September 2023:
- 2/10 year Treasury Spread 6 – 22 month recession
risk window opens from Sept 2023.
- Average timeframe of increases in continuous
jobless claims prior to recession is from the 2nd
week in September.
- The last time the Federal Reserve paused interest
rates, the COVID-19 crash occurred 6 months
later. 6 months from a Sept 2023 pause would be
March 2024.
2. The Recession Risk increase higher from Nov 2023
- Average timeframe of increases in Initial Jobless
Claims prior to recession is hit.
Adding to the above concerns is that M2 Money supply is still reducing (Macro Monday 8) and Global Net Liquidity is continuing to reduce (Macro Monday 4) as the S&P 500 is hitting a major resistance zone when accounting for M2 money supply (Macro Monday 8). At present it is clear that liquidity is reducing both globally and in the US. Currently fiscal stimulus appears to be filling the gaps and may be causing additional lagging effects to the changes we have seen imposed by Federal Reserve (balance sheet reduction and increased interest rates). Keep in mind that the Fed is also targeting higher unemployment to help quell the effects of inflation thus adding to the relevance of the Initial Jobless Claims and continuous jobless claims numbers.
We can monitor these charts on my trading view just by pressing play and seeing where things are going. Regardless ill be providing updates along the way of claims releases and other important data.
Be safe out there as we enter into a high risk zone (no guarantees)
PUKA
JOLTS, Initial Jobless Claims, NFP Friday...S&P 500 INDEX MODEL TRADING PLANS for THU. 10/05
With JOLTS on Tuesday, Initial Jobless Claims Numbers this morning, and Non-Farm Payrolls tomorrow, this week is all about Jobs and Jobs. So far, there is no sign of any letting up in the strength of the Job market. Since our published trading plans two weeks ago pointing out that week's 4505 level as potential top for the near term, the market has been in a free fall mode. Our models indicate 4310 as the level to close above for the current bearish bias to be negated.
Any hope derived from bad/disappointing economic numbers could eventually morph into a concern for the economy and the potential recession talk down the road. Until a clear directional bias emerges to the bullish side, swing trading with technicals and confirmations appears the prudent way, rather than taking on positional trades.
Aggressive, Intraday Trading Plans:
For today, our aggressive intraday models indicate going long on a break above 4300, 4270, 4234, 4223, or 4205 with a 9-point trailing stop, and going short on a break below 4298, 4265, 4231, 4219, or 4202 with a 9-point trailing stop.
Models indicate explicit long exits on a break below 4280, and explicit short exits on a break above 4284. Models also indicate a break-even hard stop once a trade gets into a 4-point profit level. Models indicate taking these signals from 10:01am EST or later.
By definition the intraday models do not hold any positions overnight - the models exit any open position at the close of the last bar (3:59pm bar or 4:00pm bar, depending on your platform's bar timing convention).
To avoid getting whipsawed, use at least a 5-minute closing or a higher time frame (a 1-minute if you know what you are doing) - depending on your risk tolerance and trading style - to determine the signals.
(WHAT IS THE CREDIBILITY and the PERFORMANCE OF OUR MODEL TRADING PLANS over the LAST WEEK, LAST MONTH, LAST YEAR? Please check for yourself how our pre-published model trades have performed so far! Seeing is believing!)
NOTES - HOW TO INTERPRET/USE THESE TRADING PLANS:
(i) The trading levels identified are derived from our A.I. Powered Quant Models. Depending on the market conditions, these may or may not correspond to any specific indicator(s).
(ii) These trading plans may be used to trade in any instrument that tracks the S&P 500 Index (e.g., ETFs such as SPY, derivatives such as futures and options on futures, and SPX options), triggered by the price levels in the Index. The results of these indicated trades would vary widely depending on the timeframe you use (tick chart, 1 minute, or 5 minute, or 15 minute or 60 minute etc.), the quality of your broker's execution, any slippages, your trading commissions and many other factors.
(iii) These are NOT trading recommendations for any individual(s) and may or may not be suitable to your own financial objectives and risk tolerance - USE these ONLY as educational tools to inform and educate your own trading decisions, at your own risk.
#spx, #spx500, #spy, #sp500, #esmini, #indextrading, #daytrading, #models, #tradingplans, #outlook, #economy, #bear, #yields, #stocks, #futures, #inflation, #recession, #softlanding, #higher4longer, #higherforlonger, #adp, #joblessclaims
ES Levels - CGG Newsletter (08/13-18/2023)Upside:
4478 → 4500 → 4519 → 4542 → 4566
Downside
4459 → 4447 → 4422 → 4400
Technical Analysis:
ES tested a breakdown of a Long GP from 4461-4470, but bounced to close the Friday down only -0.1%. We want to see if ES can hold above last week's lows, if not, I could see a test below in the 4447 area where we should start to see buyers come in. This area would be crucial for us to hold this week as the bullish trendline we made from this year's March lows sits right in that area. I lean bullish throughout the week as long as we hold that trendline as support into the Jackson Hole Economic Symposium which starts next week, August 24-26.
I would expect some bullish movement to send us back to at least 4566, which was a strong daily level which also coincides with the SHORT GP that was just made from July's high to the low made on Friday.
USD/CAD- Canadian dollar extends gains despite weak job dataThe Canadian dollar continues to rally. USD/CAD is trading at 1.3328 in the North American session, down 0.22% on the day.
The week wrapped up with Canada's May employment report, which usually is released at the same time as the US job data, but had the spotlight to itself today. The data was a disappointment. Canada's economy shed 17,300 jobs, all of which were full-time positions. This followed an increase of 41,400 in April and missed the consensus of a gain of 23,200. The unemployment rate rose from 5.0% to 5.2%, the first rise since August 2022.
The weak job numbers could signal softness in the labour market, which would have major ramifications for the Bank of Canada's rate path. The Canadian dollar lost 40 points in the aftermath of the release but quickly recovered these losses. We could see more movement from USD/CAD on Monday as the markets digest these numbers.
The US labour market has shown resilience, as we saw last week with a red-hot nonfarm payroll report. Still, some cracks have appeared, such as the jump in the unemployment rate and a low participation rate. The markets are looking for signs that the labour market is cooling off and jumped all over unemployment claims, which surprised on the upside at 261,000, up from 233,000 a week earlier.
A spike in one weekly report isn't all that significant, but the timing of the release close to the Fed meeting may make a Fed pause more likely, and that has sent the US dollar lower against its major rivals.
Central banks continue to wrestle with high inflation, which has remained stubbornly high despite aggressive rate tightening. This week alone, the Reserve Bank of Australia and the Bank of Canada raised rates by 0.25%, surprising the markets which had expected a pause.
The BoC has made clear that its "conditional pause" stance would be data-dependent and perhaps the markets should have paid more attention to the uptick in April inflation and strong GDP growth in the first quarter. The BoC highlighted both of these indicators in its rate statement as factors in its decision to hike rates, and the central bank will be keeping a close eye on economic growth and inflation ahead of the July meeting.
USD/CAD is testing support at 1.3339. Below, there is support at 1.3250
1.3496 and 1.3585 are the next resistance lines
$QQQ Outlook 05/30 - 06/02The tech sector is on a tear. NASDAQ:NVDA earnings set the tone last week and the AI craze is on. NASDAQ:QQQ had a bullish week, closing up +3.53%, bringing it up +8.76% on the month. Strong earnings, job cuts, and developments in AI technology has sent the sector higher.
Technical Analysis: The last two weeks saw NASDAQ:QQQ break out of the rising wedge we were watching. Last week’s high signaled a test of a bullish channel. This channel uses the same uptrend support line we’ve been watching since the beginning of March. We are looking to see if this continues higher, or if the channel resistance is respected.
My general lean for this week is bullish, although after last week’s incredible run, I do expect a bit of a retrace before we head higher. A healthy pullback is due so we can continue to move up this channel. I would be bullish if price action can continue to hold above last week’s close of 348.40.
Bear case if we can break below last week’s open at 336.25. I’d expect a bounce here as it is in the golden pocket (0.618 retrace would be 337.08), but if we cannot hold this level, we could target the gap to fill below down to 332.91 which would invalidate the golden pocket.
Upside Targets: 348.40 → 349.25 → 350.72 → 352.46 → 354.43 Extended: 356.78
Downside Targets: 346.38 → 344.57 → 341.31 → 338.19 → 336.25 Extended: 334.35
April's CPI Surprise: Can Bulls Charge Forward For Now?SPDR S&P 500 FUTURES ( CME_MINI:ESM2023 ) & ETF ( AMEX:SPY ) - Market Update - 10/10/23
The April Consumer Price Index (CPI) report showed a 0.4% increase last month, driven by rising shelter, used vehicle, and gas prices. This increase met Wall Street expectations, and the annual inflation rate of 4.9% came in slightly below estimates, providing hope for a lower trend. For workers, real average hourly earnings, adjusted for inflation, rose 0.1% for the month but were still down 0.5% from a year ago. These CPI figures provided a stick save for ES_F.
A massive 60-point range started with a failed breakout at 4176, and ES_F tested the overnight low, flushing to the 4114 support level. An intraday bull flag formed at the 4118-4123 support zone, with bulls getting long at the 4129-4134 range. A broadening formation (megaphone) pattern emerged at 4114, with resistance at 4176-4180. The rising uptrend channel from the March 2023 low is highlighted in yellow, establishing new support at 4134.
Bull Case:
On any pullback, look for re-entry to go long at the 4145-4146 level. If we move above 4145, the new magnet zone is 4176-4181. The 4166 support level is also a good magnet.
Bear Case:
On any pullback, look for re-entry to go short below 4134.
Economic Factors:
Keep an eye on the PPI-Final Demand and Jobless Claims data released at 8:30AM (EST) today.
Bonds:
The US10Y supports the bull case on the 4-hour chart with a new lower low. A symmetrical triangle pattern with a 5-day rising support range is visible, extending from 3.0308% to 3.311%.
Support Levels:
4134-32 (major), 4122, 4114-16 (major), 4111, 4105, 4092, 4082-78 (major), 4061, 4048 (major - broadening formation support), 4037, 4020-22 (major), 4011 (major), 3997, 3984 (major), 3978, 3952 (major), 3942, 3935 (major), 3904 (major), 3892 (major)
Resistance Levels:
4146 (major), 4154, 4166, 4176-81 (major, broadening formation support), 4188-92 (major), 4200, 4210, 4218-20 (major), 4230 (major - broadening formation support), 4243-46 (major), 4256
Final Thoughts:
As the market continues to digest April's CPI surprise, traders should remain vigilant and watch key support and resistance levels. The bull case still has potential, but it is crucial to monitor economic factors, such as PPI-Final Demand and Jobless Claims data, as well as bond market developments.
Not Investment Advice:
Please note that the information and strategies shared in this newsletter are for informational and educational purposes only. They should not be considered investment advice, nor should they be used as a basis for making any investment decisions. Always consult a financial professional before making any investment decisions, and ensure you understand the risks involved in trading and investing.
GBP/USD flat as UK GDP a mixed bagGBP/USD is trading at 1.2517 in Europe, almost unchanged.
In the UK, GDP declined by 0.3% in March m/m, below the 0.1% estimate and the February reading of 0.0%. Still, the economy managed to gain 0.1% in the first quarter, unchanged from Q4 2022 and matching the estimate.
There was no surprise as the Bank of England raised rates by 25 basis points, bringing the cash rate to 4.50%, its highest since 2008. This marked the twelfth consecutive hike in the current rate-tightening cycle, underscoring the BoE's pledge to curb hot inflation. Governor Bailey said after the rate announcement that Bank would "stay the course to make sure that inflation falls all the way back to the 2% target".
Nobody is expecting that the road to 2% will be easy, with inflation currently in double digits. The BoE remains optimistic that inflation will fall rapidly during the year and will fall to 5% by the end of the year. In February, the BOE predicted 4% inflation by the end of the year. This seems like a tall order but is certainly possible if the rate hikes make themselves felt and cool the economy.
There have been constant concerns that the BoE's aggressive rate policy would lead to a recession, and six months ago, the BoE had projected a recession. Bailey reversed course yesterday, saying that the drop in energy prices and stronger economic growth meant that GDP would expand by a weak 0.25% in 2023, versus the 0.5% contraction in the previous forecast.
In the US, the economy is showing signs of cooling and high interest rates are expected to dampen the robust labour market. Unemployment claims surprised on the upside on Thursday, rising from 245,000 to 264,000, well above the estimate of 242,000. This is just one weekly report, but it's sure to raise speculation that the labour market is showing cracks.
The US wraps up the week with UoM Consumer Confidence, which is pointing to a rather sour US consumer. The indicator fell to 63.5 in April and is expected to ease to 63.0 in May. Weak consumer confidence can translate into a decrease in consumer spending, a key driver of economic growth.
GBP/USD is putting pressure on support at 1.2495. The next support level is 1.2366
1.2573 and 1.2676 are the next resistance lines
🔴 $SPY $SPX $ES1! Analysis, Key Levels & Targets$SPY $SPX $ES1! Analysis, Key Levels & Targets
Wowza, what a breakout today above the downtrend…. I did say that if we got near the top I was going to get puts so I did, for next Thursday on the 401 strike…. That was just such a shady breakout, gapping up above the 1hr 200MA and the downtrend overnight… what is that crap… LOL…. 🤣
And 400 is officially a “level” on my charts. Kind of funny because it happens to be right near the 50MA - and somehow I’m not surprised… lol…
I did make a video going over these levels and a recap of today and my voice is a little raspy…. It’s kind of adorable…. I always think that people with laryngitis sound so cute… my voice isn’t that gone though, just a little horse…
Any bets for GDP/jobless data tomorrow??? And how the day plays out… ? Do you guys see anything in the trading range for tomorrow to look out for?
I promise to do a big timeframe analysis this weekend… I’ve been focusing so much on intraday moves but I want to step back and see where we are…
GL tomorrow, guys and take profits when you’re up…
$SPY: Breakout/drop to $395? Broadening formation's fate hangsTomorrow morning, we'll be receiving GDP data and jobless claims, which could have a significant impact on the market. Currently, $SPY is at a crucial point on the daily chart, nearing the upper limit of its broadening formation. It's showing positive trends on the daily, weekly, monthly, and quarterly charts. Keep in mind that the month and quarter will close on Friday, along with the release of PCE data.
GDP results are expected to come in flat tomorrow morning, while the jobless claims at 8:30 am could potentially offset the GDP figures.
If the data leans bullish, $SPY has the potential to break through the $405 price level and run like a bat outta hell. On the other hand, if the data comes in bearish, we may see a retest of the $398 level, followed by a potential drop to close the bullish gap at the $395.7 price level.
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GBP/USD dips on strong US data, UK GDP nextThe British pound is in negative territory today and has fallen below the 1.15 line. In the North American session, GBP/USD is trading at 1.1497, down 0.38%.
US retail sales rose 0.3% MoM in August, rebounding from -0.4% in July. Excluding gasoline, retail sales were up 0.8%, as consumers responded to lower gas prices by increasing spending on other items. The data indicates that consumer spending is holding up, despite an inflation rate of 8.3%. There was more positive news as US initial job claims fell for a fifth consecutive week, falling to 213 thousand. This follows the previous release of 218 thousand and beat the consensus of 226 thousand.
These releases are especially significant, as the Federal Reserve relies on a strong labour market and solid consumer spending in order to remain aggressive with its hawkish policy as its grapples with high inflation. The Fed is expected to increase rates by 75 basis points next week, with an outside chance of a massive 100bp hike. Inflation has proved to be more resilient than expected, and with the Fed continuing its steep rate-hike cycle, we may see more demand destruction which raises the likelihood of a recession.
The UK wraps up a busy week with retail sales on Friday. Consumers have been hammered by the cost-of-living crisis and predictably are cutting back on spending, which will only exacerbate the grim economic landscape. Retail sales fell by 3.0% YoY in July, and the markets are bracing for an even worse month of August, with an estimate of -3.4%. A release of -3.0% or worse could extend the British pound's losses.
GBP/USD is testing resistance at 1.1548. Next, there is resistance at 1.1689
There is support at 1.1417 and 1.1306
LULU: Fade the rally!Lulumelon Athletica
Short Term - We look to Sell at 329.26 (stop at 346.16)
They reported better than expected earnings and the stock jumped up premarket. The medium term bias remains bearish. We are assessed to be in a corrective mode higher. Bespoke resistance is located at 332.00. We therefore, prefer to fade into the rally with a tight stop in anticipation of a move back lower.
Our profit targets will be 284.68 and 272.00
Resistance: 332.00 / 410.00 / 478.00
Support: 283.00 / 246.00 / 129.00
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Like a bouncing ball on a downhill!Like a bouncing ball on a downhill, equities have bounced hard after repeated selloffs but the general momentum remains downward.
With Consumer Price Index (CPI), Retail Sales, Initial Jobless Claims & Consumer Sentiments numbers coming out this week, markets are likely to be jittery. Any downside surprises could spur a sharp reaction downwards.
The S&P 500 E-mini Futures have been trading in a descending channel since March with current prices trading near the channel resistance. Additionally, prices have been rejected off the 23.6% Fibonacci retracement level twice.
The strong technical resistance levels as well as potential negative economic data surprises in the coming week warrant a short position over the short term.
Entry at 3842, stops at 4025. Target at 3645 & 3500.
Disclaimer:
The contents in this Idea are intended for information purpose only and do not constitute investment recommendation or advice. Nor are they used to promote any specific products or services. They serve as an integral part of a case study to demonstrate fundamental concepts in risk management under given market scenarios.
us 30 selling idea lowest jobless claims should help this fall. please check Bloomberg for daily news post. Please message me about more info which is posted on my personal web page
Silver - Short Below Key Resistance We hold a short view on Silver whilst it remains below key resistance at $22.2 despite it's rebound today. The precious metal has been in a downtrend since mid June as the FED indicated a more hawkish stance on monetary policy causing the US dollar to strengthen. Additionally, yields have been rising with the 10 year treasury note yield rising from 1.3% to 1.5% over the past week putting further pressure on Silver prices. We await US GDP growth rate, jobless claims and GDP price index releases this afternoon for any significant price action.
Head and shoulders on the dailyMay have a head and shoulders on the daily. Disappointing retail sales and or Jobless claims could send it lower tomorrow.
