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DO or DIE for the BULLS tomorrow


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#1 dTraderB

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Posted 29 January 2019 - 07:15 PM

It's been a great rally from the December lows but it seems now to have fizzled out, not a failure because it is now 300 SPX points higher, but the market has stalled. 

 

Tomorrow is do or die for the bulls.

 

This is the SPX hourly chart, daily close just below the NO-BS cyan line, 20ma, and 50ma

 

Daily SPX chart can be interpreted as either bullish consolidation or ST topping in progress.

 

FED should be dovish, and even more precise, in order to convey the message: interest rate hikes are data dependent (that means none in the near future) and QT is now over, or on hold.

 

Markets should rally, real hard, with this from the FED, but lately there seems to be doubts & worries and questions about the FED, e.g. why is the FED so DOVISH? Is there something really bad that the FED knows and the rest of us don't? 

 

APPLE earnings are not as good as the market thinks....

 

NOTE

; this is not a MA "system" but if you buy or sell above or below that NO-BS cyan line you will be in sync with the market.

 

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#2 dTraderB

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Posted 29 January 2019 - 07:29 PM

How Chair Powell Could Spark A Massive Rally By Doing Nothing

Summary

  • The market is irrationally obsessed with the “$600 billion” annual roll-off in the Fed’s balance sheet
  • The actual reduction in the balance sheet will be much smaller and is determined by the profile of monthly Treasury and MBS securities maturing in the SOMA portfolio
  • The balance sheet reduction will not come even close to the zip code of a $600 billion annual reduction
  • The asymmetrical liability accounting of QT versus QE makes the runoff look similar to a quasi-deficit financing
  • By conveying to the market the balance sheet will not be reduced by $600 billion annually and announcing an annual cap of, say, $450 billion, the Fed Chair could spark a massive nutcracking short-covering rally, in our opinion
  • Maybe he should.  Maybe he will

It is truly stunning to watch, what some academics believe to be, an efficient market come unglued over the Fed’s “$600 billion annual balance sheet reduction”

Recall the Fed announced to its “Normalization Principles and Plans” at the June 2017 FOMC meeting,

fed_6-1.png?w=640

Source:  FOMC

Those are frickin’ caps, not levels!

The Fed began their balance sheet reduction in October 2017 and has reduced, as of January 23rd, its holdings of Treasury securities by $252 billion and MBS by $140, which is only 78.40 percent of the cumulative monthly caps mentioned in the normalization statement.  Why is this so?

 

https://macromon.wor...-doing-nothing/



#3 dTraderB

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Posted 29 January 2019 - 07:30 PM

David Rosenberg @EconguyRosie
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The expectations component of the consumer confidence survey plunged more than 10 points in January to its lowest level since October 2016. This is the 3rd drop in a row, and by an epic 27.8 points, which is something that only happens heading into recession. Charts don’t lie.

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11:33 AM - 29 Jan 2019


#4 dTraderB

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Posted 29 January 2019 - 07:31 PM

The "bond king"....

 

The most recessionary signal at present is consumer future expectations relative to current conditions. It’s one of the worst readings ever.



#5 dTraderB

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Posted 29 January 2019 - 07:32 PM

David Rosenberg @EconguyRosie
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Look at this chart: ratio of “present situation” to “expectations” from the Conference Board confidence report. Cut-and-dry sign of a tapped-out consumer. A great leading indicator at turning points because it either coincides with the recession or occurs a few months prior

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12:32 PM - 29 Jan 2019


#6 dTraderB

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Posted 29 January 2019 - 07:33 PM

Drifting down but still relatively HIGH

 

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#7 dTraderB

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Posted 29 January 2019 - 07:35 PM

Sven HenrichVerified account @NorthmanTrader
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Sven Henrich Retweeted CNBC

Stocks rise on beats and misses.

Sven Henrich added,

CNBCVerified account @CNBC
Apple shares jump after barely beating on earnings, and iPhone sales drop 15% from last year. https://cnb.cx/2DGqkKK 
2:12 PM - 29 Jan 2019


#8 dTraderB

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Posted 29 January 2019 - 07:43 PM

Want a few more points tacked on to this APPLE rally before shorting

 

  1. I have added to $AAPL short at $164 and to $QQQ at $163

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  2.  Douglas Kass Retweeted

    AAPL is forecasting a ~7% drop in Q3 revenues, which it sees in the range of $55-$59BN, down from $61.1BN a year ago.



#9 dTraderB

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Posted 29 January 2019 - 07:49 PM

BEARS lining up to sell:

 

Lance Roberts @LanceRoberts
Morgan Stanley says sell this January market bounce: https://www. cnbc.com/2019/01/28/morgan-stanley-says-sell-this-january-comeback--hop-off-now-and-rest-up-for-the-next-rodeo.html 
12:10 PM - 29 Jan 2019

The always insightful @JLyonsFundMgmt had a great piece out recently on the market and what we may be overlooking. This chart showing the deviation from the long-term trend is worth paying attention to. $SPY $TLT https://realinvestmentadvice.com/technically-speaking-can-the-feds-reversal-save-the-bull/ 

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3:39 AM - 29 Jan 2019
 
 @LanceRoberts
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12:09 PM - 29 Jan 2019
 
Lance Roberts @LanceRoberts
Morgan Stanley says sell this January market bounce: https://www. cnbc.com/2019/01/28/morgan-stanley-says-sell-this-january-comeback--hop-off-now-and-rest-up-for-the-next-rodeo.html 
12:10 PM - 29 Jan 2019


#10 dTraderB

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Posted 29 January 2019 - 07:54 PM

Is The Pressure Relief Valve Starting To Release? $SPX

Well, what's it going to be - up or down? The market made its high on Options Expiration Friday and has been unable to take out that high for 6 days. With AAPL trading up in after hours and other tech names to report this week, will we be able to push through that high?

The market is very sticky here. For technicians, the bright light we see ahead is a freight train loaded with resistance on daily and weekly charts. Fundamental investors, meanwhile, continue to see earnings downgrades. We have not had heavy volume on the selling days. However, the pressure got to me as I lightened up my trades following the second 400-point down move on the Dow Jones Industrial Average in under a week. I used the Dow as a reference point, but the chart below is of the larger $SPX. We've had two days gap up on the open and trade throughout the day, only for them to both gapp down the following day, creating island reversals on a 60-minute chart or abandoned babies on daily charts, as Arthur Hill noted on Monday.

15488031130331963057683.pngNotice how the PPO 60-minute momentum is sitting at zero and is flat heading into the Fed meeting on Wednesday. We also have lower lows and lower highs in momentum, which is concerning at these levels.

https://stockcharts....e-indu-spx.html