Thursday, 27 July 2017

A very mixed day

US equity indexes closed very mixed, sp -2pts at 2475 (intra range 2484/59). The two leaders - Trans/R2K, settled lower by -3.1% and -0.6% respectively. VIX settled +5.3% at 10.11. Near term outlook offers a partial gap fill to sp'2435, before resuming upward in August.


sp'daily5



VIX'daily3



Summary

*note how the Tues/Wed' black-fail candles in the sp'500 were subtle warnings of today's break lower.
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US equities opened very mixed, but with a notable trio of new historic highs for the sp', nasdaq comp', and the Dow. There was a very strong swing lower from 12pm onward, with the market filling the first, and secondary gap zones.

The third gap zone of sp'2435/25 remains set to be at least partly filled, before the market has a better chance at pushing into the 2500s.

Market volatility saw a morning low of 9.16, but with equities swinging lower, the VIX saw a mini explosion into the mid 11s. If sp'2430s, VIX will see the 12s.
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A note on AMZN



Earnings were lousy, with headline EPS of just 40 cents, with operating costs +28.2% to $37.33bn. If you extrapolate, that makes for an annual $1.60, giving a PE of 625 with the stock around $1000.

see: https://finance.yahoo.com/news/amazon-profit-slumps-77-pct-201026358.html

Ms. Link - whom I've never been a fan of, noted how "... you buy Amazon for top line growth, not profits'. Well, being within the mainstream, I can't blame her for towing that party line, but the financial historians won't look kindly on that kind of batshit crazy investment opinion.

To be clear, I like the service, but as a company, its pure garbage. No significant profits, no dividends, and unquestionably, causing problems for thousands of retailers across the globe.

Its notable that one of the few who is actually deriving an income from Amazon is Bezos. Perhaps he'll make it to Mars via Blue Origin, before this South Sea-esque bubble bursts?
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Here in the metropolis...

Sunshine between the showers
Goodnight from London
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Wednesday, 26 July 2017

Fed day chop

US equity indexes closed moderately mixed, sp +0.7pts at 2477.  The two leaders - Trans/R2K, settled lower by -0.1% and -0.5% respectively. VIX settled +1.8% at 9.60. Near term outlook still offers a swing lower to the sp'2430s. Its notable though, that more within the mainstream are starting to tout the 2600/700s for year end.


sp'daily5



VIX'daily3



Summary

US equities saw a day of fed chop, with the sp' seeing a trading range of just 6.75pts. There were new historic highs (if only fractional) in the sp', nasdaq comp', and dow.

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Bonus chart for poster 'Kin'...

NYSE comp'.


The NYSE comp' - or the 'master index', as I call it, settled with a black- fail candle, having fallen a touch shy of breaking a new historic high. Rising trend is currently in the 11770s. If that is broken, along with the 50dma, then yes... things would get interesting.

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Its notable that today saw semi-regular guest Prof' Siegel tout another '10% of upside before year end'.


... equating to the sp'2720s and Dow 23900s. My year end target of 2683 remains on track, and is broadly shared by Oscar Carboni and Morgan Stanley.
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Market volatility was stuck in the 9s until the fed press release, which then saw a flash-print of 8.84.. a new historic low.
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Not the best of summer days


... and as the closing bell was about to ring... the grey horror clears for a few minutes of golden light. Yours truly should be somewhat far further south.

If musically inspired.. extra charts in AH @ https://twitter.com/permabear_uk

Goodnight from London
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If you think I'm worth at least $1 per trading day... subscribe.


... or you should be able to buy 2 shares of SNAP within the relatively near term each month.

Tuesday, 25 July 2017

The historically low VIX

US equity indexes closed moderately higher, sp +7pts at 2477 (intra high 2481). The two leaders - Trans/R2K, settled higher by 0.7% and 0.9% respectively. VIX settled u/c at 9.43. There are three open price gaps to the sp'2430s, and it'd be even more bizarre than VIX 8s, if those aren't filled within the near term.


sp'daily5



VIX'daily3



Summary

US equities opened moderately mixed, and battle slowly upward into the early afternoon, but that was enough to generate new historic highs in the sp'500, NYSE comp', and the R2K.

Its notable that the settling daily candle for the sp'500 was a black-fail doji. Those are suggestive of near term weakness. I fully admit I have been calling this for some days, but a retrace to at least partly fill the sp'2435/25 gap zone remains due. In the scheme of things, its only a small swing lower, 37pts (1.5%), and is entirely viable across just a few days.
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Meanwhile...

In pre-market, the VIX printed 9.04, which was yet another new historic low. The actual intraday historic low was 9.05, with the VIX settling u/c at 9.43.

VIX, monthly - historic, 30yr


I have regularly touted - since last July, that the VIX-long trade is dead. Sure, we can see brief spikes, but the highs continue to be lower... with lower lows. Even if sp'2435 in the near term, that probably won't even be enough to generate VIX 13s.

For those curious on the background for the VIX... https://en.wikipedia.org/wiki/VIX
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Hyper bullish sunshine
Goodnight from London
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