Saturday, 27 May 2017

Weekend update - US weekly indexes

It was a bullish week for US equity indexes, with net weekly gains ranging from 3.3% (Trans), 2.1% (Nasdaq comp'), 1.4% (sp'500), to 0.8% (NYSE comp'). Near term outlook offers further upside into June to the 2430/40s. Mid term outlook remains bullish, with the year end target of 2683 on track.


Lets take our regular look at six of the main indexes

sp'500


A net weekly gain of 34pts (1.4%), settling at 2415, with a notable new historic high of 2418. Underlying MACD (blue bar histogram) cycle is starting to tick higher. A bullish MACD cross is due next week, which bodes for the 2420/30s by mid June.

Best guess: upside into mid/late June to the 2430/40s. The 2500s seem a valid target by late September. The year end target of 2683 remains on track.

Equity bears have nothing to tout unless a break of rising trend. As of early June that will be around 2300, and that number is rising by around 25pts a month.
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Nasdaq comp'


The Nasdaq continues to lead the way higher, with a net gain of 2.1% to 6210, and a notable new historic high of 6217. The mid term upward trend is relentless. First soft support is the 6000/5900 zone. Grand support is the giant 5k threshold, and that is a rather huge 19.4% to the downside. The 7000s seem highly probable by year end.


Dow


The mighty Dow climbed 275pts (1.3%), settling at 21080. The intra high of 21112 was just 57pts shy of the late Feb' high. Rising trend will be at the giant psy' level of 20k in early June. By September, that will have risen to 21k. Underlying MACD remains moderately negative. At the current rate, there is the possibility of a bullish cross by mid June, when the fed are set to raise rates. In theory, the Dow has viable cyclical upside across the entire summer. By September, Dow 22k is a very realistic target.


NYSE comp'


The master index saw a net gain of 0.8%, settling at 11631. The intra high of 11666 was 21pts shy of the late Feb' high. A mid term push to the 12000s seems a given by late July/August. A year end close >13k looks a stretch, and will greatly depend on what degree of autumnal retrace/cooling there is.


R2K


The second market leader - R2K, settled +1.1% to 1382. Underlying MACD remains negative, but is showing another attempt to tick back upward. At the current rate, a bullish cross is viable by end June. Upper bollinger is offering the 1410s. Its notable that the width between the upper and lower bollingers hasn't been this tight since summer 2015, just before things fell to pieces (largely China inspired). Equity bulls should be seeking definitive new highs in the R2K no later than the next earnings season of July.


Trans


The 'old leader' - Transports, saw a powerful net weekly gain of 3.3%, settling at 9176. The weekly closing was a borderline settlement above short term downward trend/resistance, that stretches back to the Feb' historic high of 9639. Equity bulls should be seeking the 9700s this summer to give confidence that the broader market remains strong. A grander move to 10k by September is on the menu, with the 11000s viable by year end.
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Summary

All US equity indexes remain within their mid term upward trends from early 2016

The US market is still regularly breaking new historic highs, lead by the Nasdaq comp' and sp'500.

The Transports remains the market laggard, but it should also break new highs this summer.

Most indexes have downside buffer of around 5% before key aspects of support are tested.
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Looking ahead

M - CLOSED
T - Case-Shiller HPI, Pers' income/outlays, consumer conf'
W - Chicago PMI, Pending home sales, Beige book
T - weekly jobs, ADP jobs, prod'/costs, PMI/ISM manu', construction, EIA Pet' & Nat' gas reports
F - monthly jobs, intl' trade

*the only fed officials scheduled are Kaplan and Williams on Wednesday. Broadly, the market is still expecting a June 14th rate hike. An equally important issue is when the fed will start to cut its balance sheet, many now expect that to be announced in Sept.

**as Wednesday is end May, there will be the usual end-month trading issues. Price action should be a little more dynamic, with higher volume than normal.
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I continue to post intraday at permabeardoomster.com. If you think I'm worth around $1 per trading day, then subscribe!


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For extra charts (usually after 7pm EST each day), see https://twitter.com/permabear_uk

Have a good weekend
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*the next post on this page will be Tuesday May 30th at 7pm.

The long weekend

US equities closed fractionally mixed, sp' +0.7pts at 2415. The two leaders - Trans/R2K, settled +0.1% and -0.1% respectively. VIX settled -1.8% at 9.81. Near term outlook offers a gap fill of 2409/04. More broadly, the sp'2500s are a valid target by late September.


sp'daily5



VIX'daily3



Summary

US equities opened weak, and then saw micro chop across the day. The Friday fractional gain made for a seventh consecutive gain, equalling the February run.

This morning's revised Q1 GDP print of 1.2% was again notably still weak, but then neither is it remotely recessionary. Its just a case of the US economy 'ticking along'.

Market volatility remained very subdued, with the VIX settling the week in the 9s.
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Podcast from Coffey and Najarian


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Day'3 of summer 2017 :)

For extra charts (usually after 7pm EST each day), see https://twitter.com/permabear_uk

Goodnight from London
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*the weekend post will appear Sat' 12pm EST, and will detail the US weekly indexes

Friday, 26 May 2017

Another set of new historic highs

US equity indexes closed broadly higher, sp +10pts at 2415 (intra high 2418). The two leaders - Trans/R2K, settled higher by 1.6% and 0.1% respectively. VIX settled -0.3% at 9.99. Near term outlook offers a little cooling to 2409/04. Any sustained price action under 2400 now looks unlikely.


sp'daily5



VIX'daily3



Summary

So much for any weakness ahead of the Memorial day break, as we saw new historic highs for the sp'500 and Nasdaq comp'. Market volatility remains very subdued, with the VIX once again cooling into the 9s.

I'm well aware of some of the very bearish chatter out. A fair few are touting a decline to around the 200dma. That will be in the sp'2270s in early June, and is clear 5% lower. Is it possible? Sure, but just what excuse could the market use to see that kind of down wave?

Other than something 'nuclear' in North Korea... I can't think of anything.
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Podcast from Coffey and Dr J.

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Just another sunny evening in the city.

Goodnight from London
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