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A TOP ahead but not there as yet - BOND KING warns


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#1 dTraderB

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Posted 24 July 2019 - 03:36 PM

Not rip roaring but a rally is a rally, DOW is down but SPX & NQ are up, record highs, and the FED & TRUMP PUTS are fueling the market. 

 

Of course, there is a TOP head, could be over SPX 3100, but we are entering the final week or two or this leg up. 

 

RUT finally got energized and is now green for July and BANKS are joining in the party. 

And, finally, we may get that single-digit VIX -- that's a sure sign we are near the TOP.

 

BIG BIG earnings day tomorrow, and Friday is GDP day, leading into FED next week. 

 

Unless there is a huge geopolitical event, I expect the market to grind higher into next week, maybe a final spike up and then DOWN.

 

I had one of my best NQ trading 3-day periods this week, hope we can get some big tech earnings to finish this week and I can add to my meager QQQ Oct PUTS.

 

I agree with Gundlach but that is down the road, trade the rally until we get there

 

Gundlach: Fed Will Be In "Panic Mode" When A Recession Hits

Authored by Robert Huebscher of Advisor Perspectives

If the signs of a recession, like weakness in trucking volume and manufacturing PMIs, prove true, the Fed will be in panic mode, according to Jeffrey Gundlach. The economy will weaken, rates will go up and the Fed will have to “do something,” to protect against a “spiral” of higher rates feeding and slower growth.

Gundlach is the founder and chief investment officer of Los Angeles-based DoubleLine Capital. He spoke to investors via a conference call at 4:15pm on July 23. The focus of his talk was DoubleLine’s fixed-income closed-end funds, DBL and DSL.

Gundlach devoted most of the call to the positioning of DBL and DSL. I will focus on the last 15 minutes of the call, when he took questions from the attendees, with the focus on a possible recession and the direction of interest rates.

https://www.zerohedg...-recession-hits



#2 dTraderB

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Posted 24 July 2019 - 04:08 PM

Getting there... near, but not the top. 

 

VIX Call Buying Explodes in Wave Evoking Memories of `50 Cent'
Yahoo Finance-39 minutes ago
But this type of buying behavior has been seen only sparingly since then.“The large VIX call buying over the past two days is a definite change of character in the ...


#3 dTraderB

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Posted 24 July 2019 - 04:10 PM

1000x-1.png

  • Big buyer hedging against U.S. stock rout over the next month
  •  
    Put/call ratio hits the lowest level in more than four years
 


#4 dTraderB

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Posted 24 July 2019 - 04:13 PM



#5 dTraderB

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Posted 24 July 2019 - 04:16 PM

Breadth has been bad? 

From Marketwatch:

 

These 5 technical indicators are sending warning signals for the stock market

The most closely watched U.S. equity benchmark indexes have celebrated numerous record closes of late, but the broader stock market has not joined in on the fun.

Measures of market breadth have deteriorated in recent weeks, and analysts say that this dynamic may foretell a significant pullback ahead for the S&P 500 indexSPX, +0.47%  

Market breadth is a term describing the number of stocks that are gaining or losing ground during a given period, and can provide investors insight into the broader stock market that are hidden by market-capitalization weighted indexes, like the S&P 500, which places greater emphasis on the most highly valued firms.

Thin market breadth can portend weakness in market-cap weighted indexes, as it’s uncommon for a handful of large companies to consistently rise in value while most publicly traded firms are not, analysts say.

“There are some definite warning signs in these indicators,” Mark Newton, president of Newton Advisors told MarketWatch, adding that he has recently changed his medium-term outlook from bullish to neutral and expects a significant pullback in stocks sometime this fall.

Newton pointed to the relative underperformance of small and mid-cap companies, which have fallen relative to the S&P 500 to the lowest level in 10 years. “While it’s right not to get too bearish on a couple years of small-cap underperformance, the combined deterioration of both small and mid looks important given the rate of change of this decline in the last six to twelve months,” he said.

 
MW-HO085_spxrut_20190724143801_NS.jpg?uuFactSet
The small and mid-cap Russell 2000 continues underperform

Craig Johnson, chief market technician at Piper Jaffray, agreed that market internals were flashing warning signs, in a recent note to clients. “Market breadth remains an ongoing concern as evidence suggests there has been a growing divergence between the recent record highs on the SPX and overall participation,” he wrote.

“Over the last several weeks there has been a declining percentage of stocks registering new 52-week highs on the S&P 500, despite its near 10% record-high rally,” he added. “Based on the divergence in breadth accompanied with weak volume and deteriorating momentum, we believe risks for a deeper pullback are growing.”

Johnson sees the S&P 500 SPX, +0.47%  ending the year at 2,750, or nearly 9% below its current level.

https://www.marketwa...w_theo_homepage



#6 dTraderB

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Posted 24 July 2019 - 04:18 PM

More from that Marketwatch article:

 

The ratio of stocks on the NYSE gaining versus those declining has also started to fall. It remains near all-time highs, but it has been retrenching for the past two weeks, and according to Newton, this statistic is worth watching as “many of the recent records occurred with flat or negative breadth.”

Newton also watches the McClellan Summation Index, a smoothed gauge of market breadth, which peaked in late February and fell into June before rallying again. “Yet it rallied at much lower highs,” he said. “Note that this peaked last August 30th, a full month ahead of the S&P 500 in mid September” before market’s swooned in the fourth quarter of last year, he said, giving credence to the index as a forward indicator of the broad market.

MW-HO086_mclell_20190724151002_NS.jpg?uu
 

https://www.marketwa...w_theo_homepage

 

 

#7 dTraderB

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Posted 24 July 2019 - 04:21 PM

Not extreme greed, just mere GREED:

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

 

Doesn't look too bad:

https://www.marketin...llan-oscillator

 

http://www.naaim.org...exposure-index/



#8 dTraderB

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Posted 24 July 2019 - 04:24 PM

a 9 handle before it's all over for the BULLS

Not saying it can't TOP off with a 10 or higher VIX but 9 will be much better 

 

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Just a reminder that on: Oct 5, 2018, $VIX was as low as 11.72 Jan 29, 2018, $VIX was as low as 11.68

2:11 PM - 24 Jul 2019


#9 dTraderB

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Posted 24 July 2019 - 04:25 PM

Sven HenrichVerified account @NorthmanTrader
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VIXplosion. $VIX is getting crushed this week, but is setting up for another explosion higher. https://northmantrader.com/2019/07/24/vixplosion/ 

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11:46 AM - 24 Jul 2019


#10 dTraderB

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Posted 24 July 2019 - 04:26 PM

SentimenTraderVerified account @sentimentrader
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If the put/call ratio stays where it is, it will be low enough to be a bit of a worry. @hmeisler @WillieDelwiche #sentiment

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12:43 PM - 24 Jul 2019