16 replies to this topic

[dTraderB]

Market bounced off the ledge overlooking the deep abyss as the Trade Advisor Peter Navarro walked back the "china investment"  tough talk but this is playing right into the hands of China et al, nicely summed up like this:

"Peter Navarro is out on CNBC as we write trying to calm the markets.  Don't you think our trading partners see this, that the administration fears a market downturn, and can play hardball until the U.S. caves?   Let the game(s) theory begin!"

 

https://www.cnbc.com...-and-other.html

 

So,  the effect of this temporary intervention to calm the markets, the latest in a series of panic moves whenever the market tanks, will soon wear out and we will be back to more "tough talk" and more wild moves in the markets. Pretty soon, people will see ignore the interventions and take it down below the 2018 lows  When? before November 2018.

 

A quick look a the SPX daily shows a close just above the 50ma, with next major resistance at the important 2740/45 zone and support at the 2700/2703, and then at the 200ma (2664)

 

 

Edited by dTraderB, 25 June 2018 - 07:43 PM.

[dTraderB]

DOW closed below the 200ma but HULBERT thinks this is a BUY:

 

Break in 200-day moving average is historically bullish

Those cries of anguish you’re hearing are from technicians lamenting the Dow Jones Industrial Average breaking the 200-day moving average in Monday’s losing session.

Don’t get caught up in their hysteria. In fact, a shrewd contrarian bet might even be to consider that break as a buy signal.

https://www.marketwa...gnal-2018-06-25

[dTraderB]

And, JEFF COOPER thinks buying the dip is not a good idea and sees more downside:

"Jeff explains why buying the dip may not be a good idea. See why the market is in a dangerous positions, and see the signals suggesting more potential downside"

 

https://www.t3live.c...per-buying-dip/

[dTraderB]

Then there is the 501-day DOW streak broken:

 

This 501-day trading streak for the Dow just came to a screeching halt

https://www.marketwa...reak-2018-06-25

[dTraderB]

I think this bounce off SPX 2700 can go higher, even much higher, before the decline resumes, but the instability and uneasiness persist and markets can drop on any news or even on rumors.  "This Could Get Bad

You mean it could get worse?

That seems strange considering that the Dow Jones Industrial Average has dropped 328.09 points, or 1.3%, to 24,252.8 after President Donald Trump ratcheted up the trade-war talk with warnings to U.S. trading partners, and on reports that the administration would put restrictions on Chinese investments in U.S tech companies.  The S&P 500 fell 1.4% to 2717.07, and the Nasdaq Composite slumped 2.1% to 7532.01.

But that might only be the beginning, claims Chris Zaccarelli, chief investment officer at Independent Advisor Alliance. "Markets are starting to price in the possibility of a trade war with China, however, I would argue that a true trade war–one that drives us into a worldwide recession–would lead to a 20% or more drop in prices, so we haven’t priced one in yet," he writes. "Instead, what we are experiencing is how the Trump administration is applying pressure to the Chinese so that they will eventually agree to some type of compromise (e.g. this is part of the negotiation)."

I'm not sure I want to hear that word–"negotiation"–in this context again. We've been hearing it since Trump first started ratcheting up the trade talk, and through each iteration of the process. At some point, however, the negotiations, if that's what they are, will start to take their toll on the economy. And that point might be here. JPMorgan's David Hensley notes that June's flash manufacturing PMI points toward an "unusual sharp drop in expectations versus current conditions," and that the results, which were released last Friday, "hinted that manufacturers are getting worried, especially in the U.S."

 

And not just manufacturers at this point."

https://www.barrons....ning-1529961128

[pdx5]

Sell in May and go away could work again this year.

 

Interest rates have 4 more increases announced by FED through 2019.

World debt is at record levels. That is risky when rates are going up.

Federal interest payouts near $1 Billion/day.

Federal budget deficits are expanding due to tax cuts with zero spending cuts.

Tariff wars are just beginning. Good in the long run, bad in the short run.

 

Other than that there is nothing much to worry about.

Unemployment is essentially zero. (more job openings than people seeking jobs)

GDP is growing nearly four times bigger than last decade.

North Korea is not sending rockets.

Putin wants a summit with Trump.

Tariff wars will slowdown Chinese military expansion due to slowing their economy.

There are no oil shortages, gas is half price from previous records, inflation adjusted.

Edited by pdx5, 25 June 2018 - 08:06 PM.

[dTraderB]

Another opinion:
 

 now we're watching to see what kind of bounces we get but, just this morning, the S&P failed EXACTLY at our predicted and long-standing 2,728 line, which is where we consider the proper TOP of the S&P's range for the summer:

Notice how technically neat the S&P is behaving, bouncing right off the 50-day moving average at 2,716 and that's exactly down 2.5% from the high at 2,785 so we're right on the money with our 5% Rule™ and that means we'll watch for 14-point bounces to 2,730 (weak) and 2,744 (strong) though anything over our 2,728 line is a pretty bullish recovery for the moment.

[redfoliage2]

A bottom won't be reached before July 7.................

[dTraderB]

I hope so! 

Will add to short positions on any bounce. 

[dTraderB]

Looking for retest of today's high SPH 2730