30 replies to this topic

[dTraderB]

...but the inventor of McOSc and similar tools is still bullish:

 

first, did you see this?  Hope it does not radically change the daytrading strategies some of us use.... 

 

 

Tom McClellan‏ @McClellanOsc

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High-frequency algo traders spent all that money, locating their offices closer to ICE server farms and buying high-speed fiber connections to get an edge on trading, and now ICE is introducing a 3-millisecond delay trying to level the playing field.

 

Tom McClellan‏ @McClellanOsc

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I discussed this chart in my Daily Edition on Wednesday, and introduced it 2 weeks ago at https://www.mcoscillator.com/learning_center/weekly_chart/a_new_vix_indicator_thats_really_not_all_that_new/ …. The VIX Index needed to close today below 15.74 to turn down this indicator, and it closed at 15.29. So a bullish signal.

4:04 PM - 16 May 2019

Here is why today's posting in the UMich Consumer Sentiment Index is important. It shows that the Jan. 2019 dip (upward thrust on the inverted scale) over Trump's government shutdown has now been made up. Good news for continued low unemployment rate.

9:37 AM - 17 May 2019

 

[dTraderB]

Oscillating below the zero line: see links below

 

but the Summation Index still declining:

 

https://www.marketin...summation-index

https://www.mcoscill...t_breadth_data/

[dTraderB]

There seems to be some fear:

https://money.cnn.co...fear-and-greed/

 

TWO IMPORTANT charts:

 

Walter Deemer‏ @WalterDeemer

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#DrSilicon not happy:

11:46 AM - 17 May 2019

Johns Charts‏ @johnscharts

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$AAPL monthly forming bearish engulfing. Still time in candle

8:05 AM - 18 May 2019

 

[dTraderB]

SELLOFF? what selloff? where? 

Looks like SPX 3000 in a week or two....

from BARRONS

 

 

"Some chalk up the market’s calm to investors’ ability to ignore what’s happening overseas. “In our view, the reason markets haven’t budged much on worsening China headlines is because America is happy right now and simply doesn’t get it yet,” explains Richard Farr, chief market strategist at Merion Capital Group.

The fact that the University of Michigan’s consumer sentiment index jumped to a 15-year high in May suggests as much, even if the survey was taken before the latest headlines.

Others suggest that a broader battle between the U.S. and China might not be that bad for stocks, at least in the short term. Higher tariffs will probably mean a slight pickup in inflation, while interest rates will almost certainly stay low. In fact, the futures market is predicting a 75% chance that the Federal Reserve will cut rates in 2019. “Low interest rates typically mean good stock markets,” says Janus Henderson’s Wellso.

MORE FROM TRADER

 

• Pinterest Committed a Cardinal Sin for a Newly Public Company
• How Pot Paraphernalia Companies Are Taking a Hit From Tariffs
• What Does It Take to Trigger a Stock-Market Selloff, Anyway?

But what if something has fundamentally changed in the market? Investors have become accustomed to central banks stepping in to bail out the market, as the Fed did in both February 2016 and this past January, explains Macquarie strategist Viktor Shvets, who notes that damage was quickly undone in both cases “as if by magic.”

There’s no reason to expect that to change, he says, and monetary policy could soon be joined by government spending of epic proportions to keep the economic cycle going. “Investors are complacent because they no longer believe in free markets, and expect any damage from trade wars or politics would be offset by fiscal or monetary tools,” Shvets writes.

The scary part is he might be right."

https://www.barrons....ina-51558143021

 

[dTraderB]

Another Trade War? let's do it one at a time, OK? 

 

From Barrons:

Europe Is Now a Bigger Trade Villain Than China

The sustained increase in Europe’s external surplus has little to do with “competitiveness” or “reforms.” Instead, it is a function of the region’s battered domestic economies: Consumption and investment fell, which depressed imports, while exports rose in line with global demand. Domestic spending in the crisis countries—excluding Ireland, which has had its data distorted by the tax avoidance of multinational corporations—is still about 7% lower now than before 2008. Unemployment and poverty are higher.

This arrangement isn’t good for anyone. It is obviously bad for people in Europe forced to endure lower living standards, even as workers and factories remain idle. But it is also bad for Americans, who have once again been forced to absorb a glut of manufactured goods at the expense of domestic production, and for major emerging market countries, such as Argentina, Brazil, and Turkey, which borrowed too much to finance excess spending and have since been pushed into crises.

The good news is that Europeans have the power to fix their problems, both for their benefit and for the rest of the world’s. Higher spending at home would help a continent still mired in depression while also raising demand for imports from struggling producers elsewhere.

China’s economic model may be problematic, but it is currently causing far less damage.

Write to Matthew C. Klein at matthew.klein@barrons.com

https://www.barrons....ina-51558118723

[dTraderB]

If the YUAN/$US goes above 7 then watch out! This will be when the  real trade war starts!

Weaponizing the YUAN and selling Treasuries are two of their most powerful tools.

 

Huawei Broadside May Be Market's 'Crossing The Rubicon' Moment

Seeking Alpha-19 hours ago

Uncertainty is most clearly visible in the yuan, and opinions vary on whether and .... We could just as easily get a shockingly weak yuan fix that throws everyone ...

Yuan slides past key 6.9/buck label on contemporary US-China tensions

National Times-16 May 2019

Friday's fixing used to be the weakest since Dec. 27, 2018. Within the obtain site market, onshore yuan opened at 6.9000 per buck, fell to a low of 6.9099 at one ...

China’s currency is sending a warning signal about the trade war

KEY POINTS

• China’s currency has been a closely watched barometer for progress in U.S.-Chinese trade talks, and for months the Peoples’ Bank of China seemed to keep it on a steady path.
• Since President Trump first tweeted about new tariffs May 5, the yuan has lost 2.7% against the dollar and it is now sliding toward a psychological level that if reached, could send turbulence through global financial markets.
• The currency could be testing that level of 7 in the coming week, and traders are watching to see whether China’s central bank will defend the key level of 7, as expected.
• “It’s also unclear whether the Chinese officials want to fight hard to keep the currency stable,” said Jens Nordvig, CEO of Exante Data.

• 

  CNBC reported Friday 

https://www.cnbc.com...hina-trade.html

[dTraderB]

Not me, not being fooled by this "trade war" bear trap; above SPX 2800 the bull lives; below that the bears take over...utnil???

 

Opinion: Crowd psychology says this ‘fool’s rally’ in stocks could fool bears Conclusion

Discerning that the S&P 500 would strike some sort of bottom around 2,810 points was the easy part. At the time when I published the yellow projection, it seemed likely the S&P 500 would relapse around 2,900.

Since then, however, a number of indicators have started to challenge my original projection.

Until the S&P 500 climbs to 2,940 or falls below 2,800, I would allow this rally to take its course.

https://www.marketwa...ears-2019-05-18

[dTraderB]

Wishful thinking!  Volatility can explode anytime, even far more than last January.

 

 

Here’s one reason Wall Street’s ‘fear gauge’ didn’t explode amid the stock market’s recent skid

"The analysts explain the result of those moves this way: “Unwinding of this exposure has kept in check the increase in the VIX and prevented the type of VIX increase we saw in February and October last year.”

The JPMorgan strategists say positioning, or bets on VIX, remain subdued and said that they are expecting stocks to see similarly muted action, barring any new Twitter flare-ups from Trump. “This is consistent with our last report, where we pointed out that pullbacks are likely to be less severe compared to those last year,” the analysts said."

https://www.marketwa...skid-2019-05-16

[dTraderB]

Yeah, may be true, but inflation is way down on the list of stuff bothering traders:

 

From Northman Trader:

"...There is a battle going on between reality and make belief and equity prices are a play thing of the 3 pillars of make belief: 1. Central banks. 2. Political jawboning and 3. Buybacks the combination making for a toxic mess in price discovery.

Technicals tell a different story, a story of reality trying to break through...."

 

https://northmantrad.../19/toxic-mess/

[dTraderB]

I think FUTURES will be DOWN later in Globex session and then attempt to go UP to Friday's close, unless there is something notably bearish during the next 24 hours. 

 

Here's Lance:

Unfortunately, that bounce was unable to hold above the 50-dma on Friday which negates the break above it earlier in the week. Importantly, the deeply oversold condition was somewhat reversed which now sets the market up for a potential retest of the 200-dma average over the next couple of weeks. A failure at that level and we have to start having a different conversation about portfolio allocation models. 

For now, the market is working a corrective process which is likely not complete as of yet. As we head into the summer months, it is likely the markets will experience a retracement of the rally during the first quarter of this year.As shown in a chart we use for position management (sizing, profit taking, sells) the market has just issued a signal suggesting risk reduction is prudent. (This doesn’t mean sell everything and go to cash.)

There is no “law” that says you have to be “all in” the market “all the time.”

Every good gambler knows how to “size their bets” relative to the “hand they hold.” This is particularly the case when it certainly appears the “bulls are betting on a long shot.” 

 

https://realinvestme...-shot-05-17-19/