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Thursday DJIA hitting new highs, and Materials breaking out- Mid-day Technical Webinar link

Thursday Technical Webinar-   20 min covering 5 Key Themes-   No daily video, as this longer video will take its place today

https://stme.in/pnC2sxrevr

  

BUY XLB-  3-4 month timeframe-  Stocks like DWDP attractive technically to own

BUY EURUSD for move to 1.1940 initially

Buy CQQQ as Chinese Tech looks more appealing than US Tech at the moment

Hold off on buying Treasuries until next week, but 3.12-4 should be very good area.. and Demark signals will line up

 

S&P and DJIA back at new all-time highs, yet the NASDAQ is still well below and not keeping up of late.   Most of Europe closed positive to the tune of 1%, but still well off recent highs, and Asia was mixed

Key development for today is the US Dollar attempting to break down which is lower by 0.60% vs Euro but down over 1% vs many LatAm currencies as well as S African Rand

This is serving to help MATERIALS breakout.. and stocks like LYB, MOS, DWDP, IFF, EMN are all up over 1.5%  (while not significant to the SPX, the Materials sector turning up is a positive and looks to be directly coinciding with the Dollar turning back lower

  

BBDXY-   this Bloomberg Dollar index breaking down to the lowest close since mid-July and arguably is coinciding with a decent rally in Materials stocks.. and affected Chinese Tech positively early in the week

One should be LONG the EURO and Pound Sterling and expect that further dollar weakness helps Materials and Energy along with many commodity names that have gotten beaten down of late

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 DJIA-  Back to new all-time highs after having missed keeping up with others earlier in the month

Prices stretched but will need a trendline break to care

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While all looks good with DJIA,   the breadth deterioration(Summation index). Technology waning..ARMS index, and Demark sells could be problematic for this rally being sustainable

But the number of stocks hitting new lows has not begun to appreciate enough for my liking..  but we have seen fewer and fewer stocks hitting new highs which has dropped off substantially

I find the SUMMATION INDEX helpful. The smoothed Advance/Decline.

This shows that breadth has fallen off pretty substantially in the last couple weeks to the lowest levels since May

 

SUMMATION-  So while overall “A/D” is near highs. It did peak out in June and has pulled back


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The TRIN, or ARMS index is signaling caution with extreme upside to downside volume, which is at the lowest since late Jan/Feb, the period that led to the decline into 2/8

.53 as you can see below has taken out prior lows

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Equity put/call is showing 5 day ratio back in the mid-50s.. this is also a short-term concern

2 Calls being bought for every Put

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New highs is down to 65 on NYSE.  See the extent to which this has plummeted of late

This is a concern when stock INDICES are trying to push to new highs

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NASDAQ diverging negatively, while ENERGY breaking out- US tech should be avoided in favor of Chinese tech- Wed mid-day Video and charts

Wed mid-day Technical Video

https://www.youtube.com/watch?v=WsVq0dLd0Mk

Stocks largely mixed, with S&P just fractionally higher while NASDAQ down, as Technology underperformance continues

S&P has stalled near former highs,  but tough to call this pattern bearish.  And 2920-5 remains a key area of upside resistance.

But breadth yet again is FLAT today and slightly negative... which IS a worry.  And signs of Tech/FANG names headed lower, while most of the speculation happening in Pot stocks, as names like TLRY are making parabolic movement, up 50% today alone.     For NASDAQ, the lagging has been ongoing vs SPX since mid-June and 7400 is a very important area for NDX.  Under would allow for more meaningful acceleration

Treasury yields continuing to press higher.  With TNX now up to 3.08 and 2/10 curve up to 27 bps while Dollar shows evidence of stalling out.

Meanwhile, CRUDE is on the verge of its own large breakout above 71 and should be bought, either USO, or CL futures, or XOP and OIH for stock exposure, both of which have broken out today

 

A few key themes

  1. ENERGY-    CRUDE on the verge of breaking out-  its right to own Energy-  E&Ps and seeing more signs of Oil Services joining

  2. METALS stocks-  GDX making decent continuation move.  While this has been trending down for some time,  the gradual rolling over in the Dollar is bullish for this group

  3. China starting to re-awaken-  Chinese Tech stocks making minor breakout. As per CQQQ while SHCOMP and FXI confirmed Demark buys the other day-   Good to start favoring a rally here

  4. Yields pressing higher-  This should favor Financials.. which look to have finally come alive today.. while most interest sensitive names have been losing ground.. as might be expected

  5. Technology underperformance- 

 

S&P still holding up near the highs-  a move up to 2925 looks likely while an breach of 2883 would be problematic

But both S&P and DJIA in better shape than NASDAQ near-term

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NASDAQ 100 quite a bit weaker.. and 7400 is very important to hold for NASDQ.  Under allows for a pullback to test late June lows

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ENERGY working well.. and both XOP and OIH breaking out today.

Would favor VNOM, CRC, DNR, MRO, MPC, EGN, COP just to name a few.  But this sector likely works well, particularly with crude over 71 (WTI)

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MRO is a name I like within energy.. just starting to emerge-  

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Viper Energy Partners LP-   VNOM-  an Energy vehicle hitting new all-time highs, and something which is attractive from a trend following perspective within the group

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MPC-  Marathon Pete-  I consider today’s pullback an attractive buying oppty- Like energy and MPC in general to outperform

Would buy into today’s weakness, technically

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Conoco- COP_ Another attractive technical idea within the energy space-  Expect this to challenge former highs from 2014.. and movement up to the 80s likely

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S&P pullback back down to key 2900 area- Monday Mid-day Technical Video and charts of interest

Monday Technical Video-  5 min on S&P, NASDAQ 100, and AAPL

https://stme.in/fwzyx0BuES

  

Markets weakening with S&P back down to key 2900 area and breadth fractionally negative heading into the last couple hours of trading.

Technology and Financials both underperforming while Discretionary lagging more than any other sector with AMZN and NFLX both down more than 2%.

Other retailers showing some signs of pulling back also with TIF, JWN, KSS, GPS and M all within the 10 top worst performing stocks in the S&P and lower by more than 1.6%.

Treasury yields have largely stalled out, while the Dollar is still fairly weak

 

For now, unless S&P Futures finish under 2900, there’s insufficient weakness trend-wise to think markets start to accelerate lower, though the concentrated weakness in Tech is a definite concern along with the inability of Financials to muster much rally.   

 

S&P 120 min chart-  Pullback thus far has held where it needs to, but under 2900 on an hourly close,  should lead to 2884 and then 2869-74 which is more important

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S&P- Daily -   Weakness has undercut Friday’s lows, but thus far not too much weakness,  but a break of recent lows would be far more negative so under 2900, the real area of concern is 2869-72

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TNX-  early day rally in yields above 3.01 has now backed off given the equity selling, but still an important move in yields if not erased

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NASDAQ-   100 Dec futures-  All eyes on the NASDAQ 100 given tech weakness and this can’t afford to get under 7400 without causing a much larger pullback

 





Both AAPL and AMZN which I discussed on CNBC last week are meaningfully lower, greater than 1.70%

My interviews found me negative on both of these stocks in the short run,  and my thought process is laid out here:

 

AAPL-   My CNBC interview on AAPL-  Bearish ahead of product launch

 

https://www.cnbc.com/2018/09/12/ahead-of-apples-product-launch-trader-is-playing-for-a-pullback.html

 

My CNBC interview on AMZN.  Calling for move to 1650 from its prior 2045 area about 2 weeks ago

https://www.cnbc.com/video/2018/08/29/trading-nation-amazon-1-trillion.html

Healthcare- Quick Technical Thoughts- CI, MTD, ZBH, ZTS, CVRS, THC, MNK, CLVS, NBIX

Here are some quick thoughts on some Healthcare names showing both bullish and bearish price action this past week

  

POSITIVE

Some bullish price action in CI, MTD, ZBH this week which looks to extend

ZTS getting close to bottoming and worth buying here technically,  CVRS also a huge week percentage wise and overall starting to show more evidence of bottoming out

 

NEGATIVE

While THC, MNK, CLVS still look to pullback further-  bearish charts

NBIX stretched here and some evidence of near-term peaking out after 2 straight weeks well off its highs

 

 

Good progress out of CI this week-  any pullbacks here should be bought.  

Good triangle breakout and should be able to extend

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ZTS looks to be close to trying to bottom after the last month of sideways consolidation.

I like buying

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 MTD should be bought as this starts to turn back higher, breaking minor downtrend

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ZBH-  Also good move here, but likely stalls near 133 at prior highs-  So next couple points would consider selling into this barring any fundamental catalysts

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SRPT-  Overweight-  Still a good stock to add to as recent gains and structural progress should help this reach 175, and early to sell into strength

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CVRS- weekly-  Some definite evidence of this trying to bottom out.  Big percentage move this week and volume has been heavy on these gains

CVRS broke the entire trend from 2017.. which is a good sign.. so would begin to weight heavier and buy all pullbacks

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NBIX would watch carefully as some evidence of topping behavior with 2 straight weeks of closing well off early week highs while extended.

UNDER 116.26 would suggest the start of a  pullback

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THC-  A bit more selling here is likely.. no real evidence of any bottom at hand and should at least get down under 27.98


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MNK-  weekly-   Pullback to near 26 possible  and early year breakout definitely showing evidence of rolling over this week, which is a negative for the next few weeks for MNK

S&P move above 2900 a minor positive, but Financials still not cooperating- MID_DAY TECHNICAL VIDEO, links to Technical webinar, and charts of interest

Thursday Technical Video- Mid-day

https://stme.in/PAKp654GUN

 

Link to today’s Technical Webinar-  20 min-  Best longs and shorts to consider-  SPX structure, and TNX, Dollar, Gold and Oil analysis

https://stme.in/wR2HSRdZBa


S&P picture after today’s open-  S&P had broken out above 2900 in Dec Futures.  This was equivalent to the 2895 level for Sept mentioned as being important

Going forward.   2900 will be the line to watch separating a bullish from bearish view.  Holding above this gives markets a chance to test highs.. and can’t afford to be broken without expecting weakness down to 2875, , and then 2865-7.  US Dollar pulling back to what needs to hold for the bullish view..  and Yields have pulled back a bit to erase early week gains.  Crude giving back some of the last couple days gains.. but overall this move should be used to buy, technically-  Gold meanwhile has attempted to bounce, but it looks like this will require more time and near-term its right to sell into 1220-30 Gold until this can show more proof

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SM-  SM ENERGY attractive given what WTI CRUDE has done this week-   Breakout likely can lead higher, and like owning technically within energy

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Callaway Golf- ELY- stands out as an attractive technical long and this flag pattern likely gives way to higher prices

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WYNN and the casinos have bounced a bit providing good technical shorting opptys.  This group remains quite weak and right to sell into gains, expecting another move back to new monthly lows

I like shorting WYNN and LVS

 

 

  

Today’s USDTRY-  TURKISH LIRA rallying   USDTRY falling after rates hiked.  This should drive a further near-term stabilization in Emerging markets  and TRY could rally to near 5.40-5.50

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AAPL Analysis, Crude up to highs- Mid-day Technical Video, Charts of Interest

Mid-Day Wed Technical Video

https://stme.in/7Q8bKBnhWM

 

 

My CNBC interview from yesterday-  Bearish on AAPL into Product launch given overbought conditions, targeting $205 for pullback as part of current intermed. Term uptrend.

https://www.cnbc.com/2018/09/12/ahead-of-apples-product-launch-trader-is-playing-for-a-pullback.html

 

My CNBC interview from yesterday..  choosing HD, LOW out of the Big Box retailers after their recent breakout above Jan highs

https://www.cnbc.com/video/2018/09/11/trading-nation-big-box-surges.html

 

 

Markets remain fractionally negative, though NASDAQ down nearly 0.50% as stocks have struggled to regain its early positive, despite evidence of possible negotiations with China

Both Technology and Financials negative.. so over 40% of the Market..  so while those sectors and Utilities are the only ones down..  3 of 11..  they have a big impact on averages.

Sectors like Consumer Staples, Telecom up more than 1% today.  And Industrials also positive to the tune of 0.65%, so some good rallies in many names.  Yet, Technology weakness looks to be taking a toll.

Crude’s rally above $70 serving to help energy to some extent, but many Energy ETFs remain in downtrends and difficult to expect much of a rally.  So gains have been tough to come by.

Dollar weakness starting to extend a bit more in the last couple hours.  While bond also rallying  and Yields down to 2.96% on 10yr.. a bit of a pullback on last couple days. 

 

 

S&P-  KEY RESISTANCE at 2895-  near-term pattern will remain challenging until S&P can get above earlier highs.

UNDER 2879, the lows from earlier.. would cause a pullback to 2865-7 which is arguably more important on the downside

 

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Crude-   very constructive gains back to the highs of this pattern which bodes well for Crude to break out in the days/week ahead

Energy has been a serious laggard as a sector and many of these stocks remain tough to buy

Technically.. I like SM, VNOM, HLX, UNT, DNR, MCF

 

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AAPL-   Near-term, I expect AAPL likely pulls back to 205 before gains can continue-   so about a 6-8% correction as part of its ongoing uptrend

 

The stock is attractive on an intermediate-term basis technically, but AAPL has gotten a bit overbought near-term given the rise in the last few months, and just in the last week has shown some evidence of rolling over to alleviate some of these overbought conditions, correcting about 3.5% in the last 5 trading days.  I believe this should continue in this seasonally weak month

 

From late April to late August,  AAPL rose about 26% in four months’ time, causing the stock to get very extended above its intermediate-term uptrend.. and weekly RSI to spike above 70  (Relative Strength index) and remains above 70 on monthly basis.. the most overbought since 2015.

This recent start of weakness in the last week does not look complete.   So similar to 2012,  2015..  the stock looks likely to pullback in the short run.. and its runup from late April should be consolidated into late September before gains can continue

 

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AAPL-  Weekly-  $205 would be a 50% correction to the rise from late June and is considered the first real target of importance on the downside

 

 

 

 

AAPL- MONTHLY-  See how stretched prices have gotten as of this past month-   Weakness down to 205 is a minimum expectation but would provide a much better buying opportunity as part of this uptrend

 

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HD remains quite attractive and any pullback back to its base should be used to buy, arguing for further outperformance

Great technical structure in this compared to stocks like TGT, and a better near-term risk/reward

Would choose HD also over LOW as HD has consistently outperformed in recent years but has underperformed in last couple months, making for a better risk/reward in my view

 

 

 

 

 

 

 

 

 

 

 

Transports pushing to new highs a positive force given the withering in Technology

September 11, 2018
Mark Newton CMT, Newton Advisors, LLC- Contact: info@newtonadvisor.com

S&P 500 ETF Trust SPDR (SPY)-  
286.5, 283, 281    Support
290.45, 291.16-19         Resistance


LINK TO TECHNICAL WEBINAR from Wednesday, 9/5:  https://www.youtube.com/watch?v=WwyKpRK1hR4&feature=youtu.be

 

SPX - (3-5 Days)- Mildly bullish with stops and turning short again under 2865--It's thought that Tech stabilizing along with Industrials and Transports extending gains are minor bullish factors for the next couple days.  Any reversal and pullback underFriday/Monday lows puts the bearish case back on the front burner for immediate pullback to 2800-7, but its thought that selling proves mild for now.  

SX5E- EuroSTOXX 50- Minor bounce possible but should NOT get above 3350, so 40 points maximum before this turns down again.   Wave structure should result in additional weakness to take out lows in SX5E.  Underperformance still likely.

HSCEI- Mildly Bearish-  Pullback looks to have another 1-2 days before finding support near-term, with max weakness likely taking this to 10200 before rebounding.  Look to cover shorts under 10250 on weakness into Tuesday/Wednesday


Trading Longs: CCE, KSU, CSX, URI, LB, TOWR, SQ, SAIL, PS, D, NEP, EXC, NRG, ES, ETR

Trading Shorts:  VMC, TWTR, AMZN, MLM, NTES, BF/B, JD, ANTM, AMBA


TECHNICAL THOUGHTS

US Equities selling has been largely unconvincing lately, and despite some rotation out of Technology, we're still not seeing weakness in Industrials, nor in Financials, with Transports having extended after breaking back out to new high territory.  While this splintered market might show a few days of rally attempts, largely driven by the Rails, it's unlikely that Tech can muster much strength, and this latter group remains one to avoid, outside of a few selective names within Enterprise Software.   

Technically one can make the case that Transports continue higher in the next few days given the recent breakout, and the pattern in XLI also looks more bullish than bearish near-term.  While Demark weekly sells are now present on XLI, the larger pattern still merits sticking with it, from the long side, until more evidence of weakness appears.   The Dollar along with Treasury yields and commodities have not shown much evidence of volatlity in the last 24-48 hours, so it's right to stick with what's working for the next couple days, that being Industrials and Transports, and stocks like KSU, CSX, URI, TXT, LII, ENS, AMR, ROP and EMR. 

ACTION PLAN-  

Short XLK at 75.75, with targets near 72.50- Take profits on daily close above 74.67
Long IYT- with targets at 212
Long XRT with target at 54
Long XLU with targets at 55
Long XLP with targets 55, Stop at 53.98

 

Additional charts and thoughts below.

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XLI still looks to push higher in the days ahead after yesterday's outperformance.  240 minute charts showing four-hour bar charts for XLI look to extend to targets over 79 before any real exhaustion, which still looks premature on intra-day charts.  Any test of highs from late January/early February would be an area to take profits, but might be difficult in September given the degree that momentum has turned down in other sectors.  

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Transports look to be one of the stronger areas in the market in the short run, given rallies in the Rails and The DJ Transportation Avg has managed to extend its recent breakout to new highs and should be favored for further near-term outperformance in the days ahead.  Overall, a move to 11700 looks likely before any real stalling out, and IYT could be bought technically for further gains near-term.  

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AAPL looks to be finally showing some evidence of backing off, at exactly the same time we're seeing selling in other former leaders like FB, NFLX, AMZN and others.   Many didn't expect that Equities would be able to hold up given a decline in many of the stocks that had carried this rally most of the way this year.   For now, the rotation into Industrials and Financials looks important and has been able to hold indices up despite the decline in Technology.  Near-term, this is a positive, but on any evidence of these other groups giving way, one would expect signs of markets showing further weakness in this seasonally tough month.  AAPL looks to pullback to 205-210 into end of September, so any near-term rally likely will not mark any meaningful low near-term for AAPL, which pulled back to multi-day lows yesterday and shows little evidence of any exhaustion after its recent move. 

Markets struggling to rally- SPX requires move over 2895 at a minimum for progress-

Monday mid-day Technical Video

https://stme.in/tumRGMGQiT

 

 

New Technical Long ideas  PS, AKAM, LB, PVH, SAIL, HEAR

New Technical Short ideas:   TWTR, MLM, ,NTES, VMC, AAPL, AMZN, BF/B, JD

 

 

Markets have attempted to bounce today but largely are failing to make much ground-   Most of Europe closed higher by 0.50% but should be something to sell into

Not much volatlity today out of WTI Crude, Gold, TNX, or DXY..  but Dollar has backed off a bit

Healthcare is the only “down” sector today.. but gains have proven very minimal in other sectors. With only Industrials showing gains above 0.50%

 

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S&P-  See that bounces failed to get back up above 2895 which was broken last week.

While today’s move was a minor positive in having broken out above the “WHITE” downtrend, structurally trends are still bearish and momentum is negative.

So it should be expected that rallies fail and lead lower, if not today, then over next couple days.

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AAPL-  Weekly chart in AAPL shows completion of upside exhaustion for the first time since mid-last year with a completed weekly 9-13-9 and now turning lower

This could allow for a move down to 205-210.    So near-term its right to expect weakness out of AAPL.. but don’t expect any longer-term trend breaks

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VMC-  VULCAN also violating quite a few past lows.. so for those looking for short ideas.  This likely causes weakness in VMC in the days and weeks ahead.

No evidence of any exhaustion on the selling, so expect this will continue

 

SAIL-  A bullish play – Application Software which is moving back to new highs and still healthy technically

Quite a few App software stocks showing good strength and one of the few areas of Technology that can still be favored near-term

Expect move up to 34-35, but would utilize tight stops on longs

 

US Markets still not matching the selling intensity of Europe, Asia, but Technology weakness still important

Thursday Technical Video-   5 min-  there will not be mid-day videos over the next 2 trading days, as I’ll be conducting a private 2-day Client Teach in, in NYC but will resume on Monday

The daily reports will continue Thursday and Friday-  Thanks for your understanding

https://stme.in/f0DEZE6M6m

Thursday Technical Webinar link-  20 min overview of Global asset markets, technically-  and Charts of 5 top longs and shorts

https://stme.in/NEOsL45We3

US indices remain weak, but have not really shown any real acceleration which has  begun to happen in the rest of the world.

Both Europe and Asia have shown more meaningful weakness, and in particular..  Europe’s SX5e and DAX have broken down out of near-term support ranges

Market performance today is largely flat outside of what’s happening in Technology which with a -1.5% decline, is causing most of the breaks in the US indices

In turn.  Money has flowed into the defensive sectors and both Utilities and Staples are rallying sharply

Both S&P and NASDAQ have gotten under early areas of support.  2885 for S&P.. but yet, sectors like Financials and Industrials are positive today and 7 sectors out of 11 are positive with breadth just 3/2 negative

 

Signs of Yields turning lower would give more confidence of Financials starting to weaken, which in turn would allow for the US decline to become more broad-based

For now, these are the charts which seem important for today

 

S&P broke 2891 and also 2885, but regained in a pattern that’s become familiar over the last week

Movement back to the lows and closing UNDER 2885 into the bell would be more negative heading into end of week

Until then.. its better to stick with Europe and Asia shorts

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DAX-  Break of this diamond formation is a negative for German DAX

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Tuesday mid-day Technical Video- S&P, NASDAQ break initial support- Prices holding just under for now.

Tuesday mid-day Technical Video

https://stme.in/KAjlTbeLHg

 

 

Break of support..  but holding just under, for now.

 

US Equities have struggled  to regain losses after the first bounce off the lows looks to be turning back lower post Europe’s close

The area at 2891.75 at Friday’s intra-day lows is important on a closing basis.. as is remaining below 7621 in NASDAQ 100 futures

Breadth seems to be turning down pretty sharply today, at 3/1+ negative and we’ve seen most of Europe close down over 1%-  DAX, CAC and SX5E, while SXXP finished lower by 0.70%

Bond yields and the US Dollar are higher, though yields have slipped from earlier highs.  Healthcare, Materials, Telecom and REITS are all down more than 1%, and Tech is lower by 0.75% with only Utilities positive on the session.

 

Overall, its thought that holding losses down under 2891 by the close would start the September pullback, but it’s a necessity to have the NASDAQ leading lower in my view. And this is happening today, with NASDAQ lower by nearly 0.90% and EEM also down more than 2%.  

Key developments for today. Thus far. Are the Equity breakdown under last week’s lows for S&P, NASDAQ, while the US Dollar rise continues. And Emerging markets suffering as a result. Both equities and currencies.  Meanwhile Crude oil’s early breakout thus far has NOT been able to hold.. and we’re seeing this being given back with 2 hours to go until close

A defensive stance makes sense under 2891, and its right to own/buy implied volatility.

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S&P gradually rolling over.  Thus far, Bounce attempts back over 2891 look to have failed, and with 3 hours left. Further weakness could face support near 2883, then 2861

 

 

 

 

NASDAQ also under last week’s lows near 7620 that were thought to be important for today-  Failure to regain this causes a move to 7567 briefly but then a larger test of 7400

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Crude oil’s early breakout attempt failed and now important to watch if this were to weaken in the days ahead after trapping longs over 71

Movement to new multi-day low closes would be a negative for Crude-  Energy never really participated all that dramatically on the upside  but down 0.35% with the drop in WTI

 

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S&P undercutting 2894 is negative- Move to either 2883, or 2861 possible

Friday mid-day Technical Video-  Analyzing S&P structure

https://stme.in/jNQZlWbOjO

 

 

 

Thursday Weekly Technical Webinar-  LINK BELOW

https://www.youtube.com/watch?v=KTA02Ng_gRo&feature=youtu.be

 

 

S&P -  Watch if S&P spends any length of time under 2894..  an HOURLY close could be sufficient and would likely begin the decline to 2883, 2861 and 2800-7

This is the real battleground for today. An important spot-  so next 30-60 min  will show whether this can hold or not.

 

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S&P-   Daily closes day UNDER 2898. Would confirm Demark sells.. and as said above

Under 2894 on an hourly close today … means this happens this afternoon most likely and turns down

For now.. has held

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AAPL stabilizing vs AMZN-   For those who care on this.  One should favor AAPL vs AMZN in the weeks/months ahead

This is starting to stabilize and showing some evidence of bottoming.

The trend in this has been negative since 2015.. but now some initial evidence that AAPL might begin to show better relative performance

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USDCAD-  Canadian dollar weakening today.. with thoughts that a deal might NOT happen

OVER 1.32 TECHNICALLY would suggest that is correct.  As this would cause meaningful weakness in Canadian dollar

Or as seen below.  Strength in USD vs Canad Dollar

 

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My interviews from this past week and last

 

AMZN-    my CNBC interview from 8/30, arguing that 1650 should come before 2500, the new MS target

https://www.cnbc.com/video/2018/08/29/trading-nation-amazon-1-trillion.html

 

My CNBC interview talking markets as Equities close to finishing the best August in 4 years—What’s in store for Sept

https://www.cnbc.com/video/2018/08/29/sp-fantastic-august-can-the-run-continue.html

 

 

Chinese Tech stocks-  Time to buy?   BABA, BIDU, TCEHY

https://www.cnbc.com/video/2018/08/23/trading-nation-buy-chinese-tech-weakness.html

 

Retail stocks to favor-   LULU-    Last weeks interview where I picked LULU out of the handful of retail stocks to succeed.  Stock is up +15% today

https://www.cnbc.com/video/2018/08/23/two-surging-retail-stocks-could-fly-even-higher-on-earnings.html

 

S&P and TECH up to target- Midday Techincal thoughts- CNBC at 2:20

Wed mid-day Technical video

https://stme.in/YeWFkICVVz

 

 

Will be on CNBC today at 2:20

 

S&P now up to within striking distance of my target 2915-8 for S&P Futures.-   This is a resistance target for S&P  and  I do expect some slowdown from here

Breadth is about 2/1 positive with Discretionary and Energy leading-    AMZN breakout extending given today’s upgrade-  (See my comments at 2:20 on CNBC about this )

Not much progress out of industrials which are underperforming and broader industrials space is down.. – LMT, NSC, GD, UTX, UNP, CMI, NOC, DAL all lower,.  While Telecom also down

Financials also just barely positive..  so on a day that’s seen as broadly bullish.. we’re not getting much participation out of either Financials or industrials

 

ES-  S&P FUTURES- require 2 days.. so this should be complete by Friday.  But multiple signs of exhaustion and overbought.  No appeal here to chase.

And should be right to lighten up-   Favor Healthcare and energy-  but not S&P, nor NDX

 

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KEY moves:  OIH for Energy breaking minor trend  and also XLV extending move back to new all-time highs

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XLV also extending its move to new all-time highs.  And on a relative basis has broken out for the first time in over 3 years..  will be discussed in tomorrow am’s piece

 

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XLK extending move back to resistance and showing evidence of exhaustion-  one should consider taking steps to take profits in tech

I suspect a move down to 73-73.25

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Tuesday mid-day technical Video- Minor reversal, but nothing too serious thus far

Tuesday mid-day Technical Video

https://stme.in/uR7Cf0Ouu3

 

 

  • Minor reversal in US Equities.. but not too meaningful at present-  S&P needs to undercut 2874 to care
  • Bond yields have moved up to multi-day highs.. but should prove short-lived given sentiment and technically still tough to argue for higher yields
  • US Dollar pullback continues
  • Crypto breakout helping BTC and many of the Alt-coins to rise 4-6% or greater
  • Technology remains strongest sector today.   Gains in the last week have helped this sector.. after it slowed in June/July-  Upside for XLK limited to near 76. But in the meantime..helpful for stocks

 

 

3 more full days left in the month and as it stands this would be our best August in 4 years.

Minor reversal thus far in S&P and DJIA, but nothing too meaningful.    S&P needs to get under 2876 which is yesterday’s lows in Futures,  and DJIA under 25826 to pay much attention.

Europe closed with a small loss and most of Asia was fractionally higher today.   Breadth is about 3/2 negative but Tech and Healthcare leading on the upside, while Discretionary is also positive

Energy and Materials both reversed early gains and while the US Dollar is still weak today.. we have seen Crude pull back, and this directly coincided with Energy weakening a bit-  Crude technical targets still remain a bit over 70, between 70-71 over the next 4-6 days.. so its likely losses prove short-lived

 

Overall given the extent of the rally over the last few days.. it’s likely that further gains are difficult to come by heading into one of the more seasonally difficult months of the year.

Prices have gotten well overbought and many of the divergences between US and Europe remain while seasonality will continue to be negative through September, with Average mid-term election year losses of -1% for DJIA and -0.4% for S&P going back since 1950.   The DJIA has still not joined the DJ Transports back at new highs, so there is some additional divergence there also which hasn’t been alleviated by the recent push of many indices back to new highs.  VIX also has firmed of late.. and some positive divergence with VIX vs Equity markets..  as VIX remains up over 13% off early August lows and set to close at new 5-day high close today.   For now, the trend remains bullish, but up against the UPPER channel of resistance since April and stretched, with RSI readings near 70 on Daily charts , the most overbought since January.  Meanwhile, evidence of counter-trend exhaustion is now forming on Daily charts of many US Equity indices as well as style sectors.

 

Upside should prove limited in the days ahead.. but still can’t rule out a move to 2914-8 area for S&P and  VIX down to 10.50-11,  but this should be an excellent oppty to buy implied volatlity for the month of September------S&P CHART below-  see prices up near the upper end of this resistance range

 

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VIX-  See the extent of the divergence with prices well over August lows-   this needs to be watched when VIX diverges.. as the same thing happened in mid-Jan right before the market peak

 

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Technology’s minor breakout coinciding with NASDAQ moving back to new highs has helped Tech regain some of its recent underperformance..

While upside for XLK looks limited-  ie    75.50-75.75-    We’ll need to see Tech start to weaken before having much conviction that stocks move lower.

I do expect this to happen in September.  For  now.  This group is still outperforming

 

 

 

 

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Monday mid-day Technical Thoughts- S&P, Refiners, Financials, Industrials

Monday Technical Video-

https://stme.in/MxILAUo9Dd

Last Thursday’s TECHNICAL WEBINAR- Thorough 15 min call on technicals of global assets

https://www.youtube.com/watch?v=3gkpjm_QUZM&feature=youtu.be

BOTTOM LINE_  Still a bit early to fade this move here, even though S&P is in the range near Channel resistance and arguably ABOVE.  but buying implied volatlity makes sense here for the next 4-6 weeks

Daily charts show the potential for peaks by Wed of this week.. and overbought condition across the board.  So its right to not think today represents the START of a new move.. but yet look to sell into this ,  this week

For now.. still no imminent signs of reversal

Futures continuing to lift as S&P nears 2900, and has joined the SPX cash back at new highs, volume very light as expected and likely continues this whole week, but breadth about 2/1 positive

Prices have gotten slightly OVER the upper border of the Trend channel from August and momentum getting overbought now on multiple timeframes.  Financials and Materials showing gains over 1.6% while Industirals over 1.2%..  Tech almost up 1%.. while Utilities and REITS are lower..   Energy, healthcare both lagging today.-  Dollar decline has continued today

Financials and Industrials both making breakouts in the ETF’s  XLI, XLF- sector SPDRS..

NOTE_  VIX not plunging to new lows.  Above Friday’s close. .  So some definite divergence here.   And personally I have used today’s move to lighten up substantially in stocks.. and adding some implied volatlity, which I will keep until October-     VXX is the ETF for VIX which has held up above August highs. And something aggressive traders might take a closer look at

However,   DAILY Charts for S&P FUTURES still 2-3 days away from triggering the same exhaustion that is now seen in SPX.  So its still very difficult to fight this move until/unless we see some reversal

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S&P-  HOURLY counts showing very overbought conditions.  But the move has proven very sharp and would need to undercut 2881 to pay attention

Targets at this point lie

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XLF-   A constructive move out of financials.. and while KRE, KBE not showing the same bullish move.  This is positive

Stocks like GS, PRU and C both showing very good moves today and these are technically positive to think they can extend over 2-3 days

Conversely others like FITB, ZION, CBOE are better shorts than longs and ones to consider betting against for the next 4-6 weeks

REFINERS are an area to favor here. Within energy-  this plays into the theme from this week’s WEEKLY from today

VLO, ANDP, MPC are very attractive technically

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Friday mid-day Technical Video .. Links to CNBC and key points

Friday mid-day Technical Video

https://stme.in/IoclZZZ1Vi

 

 

My CNBC Interviews from yesterday

Chinese Tech stocks-  Time to buy?   BABA, BIDU, TCEHY

https://www.cnbc.com/video/2018/08/23/trading-nation-buy-chinese-tech-weakness.html

 

Retail stocks to favor-   LULU

https://www.cnbc.com/video/2018/08/23/two-surging-retail-stocks-could-fly-even-higher-on-earnings.html

 

Which of the stocks hitting new 52-week highs after being off 20% of 52-week highs is right to buy?  -  TWTR

https://www.cnbc.com/video/2018/08/23/one-fifth-sp-500-still-bear-market-these-stocks-could-rebound.html

 

 

 

Key points for today

 

  • S&P back up to above weeks highs while NASDAQ breaks out-  Channel resistance lies at 2890-5 and into early next week is an area to consider selling into-  13-18 S&P points higher- support 2868-70
  • Breakout in gold above last couple months downtrend- Closes over 1200 today should lead to 1250
  • Crude extending its own earlier week strength and move above trendline resistance- ENERGY LEADING
  • Treasury yields minor bounce failed and right back lower to 2.82%
  • Dollar selling off post Powell comments and EEM strengthening

 

 

S&P has exceeded triangle consolidation and now up to this week’s highs with NASDAQ breaking out to new high territory with energy leading the charge as Crude extends Wednesday’s breakout and now up over $69

A short positive for US Equities that should lead to further strength into early next week-  Breadth is about 2/1 positive  Under2868 again necessary to suggest a failed breakout- 

While the issues we’ve discussed over negative breadth, poor momentum, and divergences to the rest of the world continue, for now these are on the back burner as no evidence of price weakness has occurred.

Its thought that this next week brings about a test of 2890-5 in S&P which would be better area to sell into and consider shorting as September is unlikely to be positive

Emerging markets have bounced given Dollar weakness and look to extend a bit more into next week before stalling, with EEM targets at 43.75 to a max of 44.20 and would sell into strength

 

 

S&P hourly-   

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Here was the picture this am, before the breakout occurred.  See the break of this triangle ultimately has led to acceleration

Yesterday we saw false moves in both directions.. but yet never any real weakness under prior lows

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S&P-  Daily

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Gold getting up above the  trend from the last few months.  Close today above 1200 is favorable for Gold to bounce to 1240-50

 

 

 

 

 

Link to yesterday’s Techincal Webinar-  15 min-  SPX, NDX, XLF, XLK, XLI TNX, DXY

https://stme.in/iJ5Ega26He

 

Thursday mid-day technical video

  1. Daily Technical video
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https://stme.in/ZjcouLQD8S

 

 

  1. Comments- 

Will be on CNBC today 2:25pm EST- Discussing BABA, TCEHY, BIDU

 

Stocks have been on a rollercoaster today.  But overall the trend remains positive for now..  and will be positive until/unless S&P gets down under 2846

Given that prices did NOT get under prior days lows.  Its still tough being bearish. Although the price action is very Whippy to say the least.  Something to take note of

ALSO-  breadth is negative today. And was even on the early gains. By nearly a 2/1 margin

Tech is up and NASDAQ attempting to breakout.. yet, Energy, Industrials, Financials, materials all down-   Selectivity required.

 

  1. MY REUTERS INTERVIEW FROM YESTERDAY, with Fred Katayama- live in Mid-town Manhattan- NYC

https://www.reuters.com/video/2018/08/22/sp-500-set-for-mild-selloff-next-4-5-wee?videoId=457155013&videoChannel=5&channelName=Business

 

 

  1. Technical Analysis Video Webinar, 15 mins.  Today 1pm EST- https://join.startmeeting.com/info69336

                Dial-In Number (United States): (701) 801-1211, Access Code: 840-955-999

 

 

 

 

 

 

S&P FUTURES-HOURLY CHART_   Triangle of the last 24 hours  led UP.. then down.. now back to unchanged.

A very chaotic market to say the least. 

However, worth noting that Demark sells are NOT present in Futures and will take 3-4 trading days.. which suggests early next week for both futures and daily SPX to line up

For now.  Trend bullish barring move under 2846 which would be a STOP and REVERSE.. i.e. SHORT

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SPX-  Daily-  Despite some slowdown on daily charts.  Still no reversal.  No downdraft. And just sideways prices among uptrend

ABOVE 2874,  I can make the case for a quick move to 2885-95. But this should prove very difficult to get above

And I would look to lighten up longs into any move to this level.. and for those that are traders.. consider shorting

 

 

 

 

Copper-  Move down to new multi-day lows-  Copper simply cannot rally.. and bounces look to have failed again

This is problematic

 

 

 

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S&P stalling near 2874 while MID, TRAN, SML have broken out

Tuesday Technical Video

https://stme.in/TbvOtnPmND

 

 

Minor pullback in the last hour after Cohen plea deal and S&P reversing from 2874, but in general.  we’re seeing many indices move back to new highs today.  Which is generally a positive for intermediate-term.   – Small caps, mid-caps.. transports..  -  SML, IWM, MID, TRAN back at new all-time highs The NASDAQ has lagged lately.. and below July highs-   Near-term.  While new highs have expanded.. they’re still at relatively low levels..  and McClellan’s Summation index is way below levels seen back in June.   So the price action back at new highs doesn’t give a complete picture.  But yet still important to note.

 

RE:   S&P-  After 4 straight days of gains, and 70 points higher,  Still no evidence of any reversal .. and prices have now reached 2874, which was the upside target when 2863 was taken out and now just 16 points under the all-time highs from late January.  This has Gann SQUARE of 9 relationships to the 8/15 bottom  and should have some type of importance today, but we’ll see-  As charts of the S&P show below..  this area “should” have importance based on the relationships of former peaks..  but we’ll need to see some evidence of prices turning back lower to break this trend.  Until that happens, it should be more important just to focus on what’s working and whats not.  Breadth is 2/1 positive and the Defensives are being hit today.. while Energy and Discretionary are leading the charge.

 

Technology is a relative underperformer, up 0.50% and the Dollar has begun to turn down more quickly-  Yields have attempted to recoup yesterday’s drawdown-  EEM outperforming again today and gains from both WTI and Gold are following through  but movement up above 68.25 needed for bullish stance on WTI CRUDE while Gold (spot) will need to get above 1213 after all the failed rally attempts. 

But downturn in Dollar today looks serious and if/when rates turn down, this should be quite positive for the Metals

It is a positive to have SML, IWM, MID, TRAN back at new all-time highs on an intermediate-term basis-   The NASDAQ has lagged lately.. and below July highs

 

 

Stocks making good progress that are attractive Technical longs:    HEAR, TLYS, TEAM, HRTX, I,  MDT

Stocks that are breaking down that are worth mentioning-   AMTD, ETFC, SCHW, HPE

Many of the bullish leaders today in SPX are not making too much progress technically-  MU, PHM, LEN, DHI for example are all just consolidating within bearish trends and bouncing

 

 

S&P_ HOURLY_  see prices up near the apex of this move from highs and lows-   this structure would seem to offer limited upside, but movement UNDER 2850 needed for any confidence in shorts

 

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S&P-  120 min charts-   Prices at 2874-80  are thought to be at levels to sell-  and exhaustion signals are present per counter-trend systems like Demark’s TD Sequential/TD Combo

 

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MID-   Movement to new highs is a positive for intermed. Term for MID-CAPS

 

 

 

 

 

Monday Video ahead of close- Charts of interest

Monday Technical Video

https://stme.in/1Sux4z7ZJ0

 

S&P could stall out near Aug 7 highs-  First area to sell into bell- 2862-3-   

 

S&P has continued to push higher post Europe’s close, but NASDAQ 100 remains negative for the day as Technology is down, and AAPL, AMZN, TSLA, Fb and TWTR are all lower.

Breadth is higher by around 2.5/1 positive, but most of the strength is being seen in Energy, Industrials, Staples and Materials which  are all up +0.60-+.75% on the day

TECH is lower, and Utilities, while Staples are unchanged.    Today will mark the first day since February that TD Sequential sells have occurred on the SPX, while also VXX, the leveraged VIX ETF

Bond yields have started to breakdown in larger fashion, not adhering to the counter-trend buys shown late last week and on a close would reach the lowest yield level since May

A breakdown in Yields would support the contrarian case of being long Treasuries given the massive negative sentiment, and this larger trend from Feb is showing increasing signs of giving way.  Gold, silver rallying from very oversold state..

 

S&P-  hourly-   See that prices are now within striking distance of Aug 7 highs.. and 2862-3 is a big level.  Above there is little until 2874.  But thought that markets very well might peak out again with S&P at August highs-  2862-3-

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US Dollar rolling over , now its fourth straight trading day down 

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TNX down what’s thought to be an important area.. but no real evidence of this stalling out and turning back higher.

2.82 is important and under  would allow for a quick test of July lows of 2.80%. 

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NFLX, while attempting to push up. Still looks early to bottom out-  The area at 329-334 looks important and until over 334, its right to sell into gains

The downtrend from the last month is still very much intact, and no evidence of exhaustion is present like what happened at prior lows and highs

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Friday Technical Video, charts of interest- REITS breaking out

Friday Technical Video

https://stme.in/IQdIDES5wP

 

Key points headed into weekend

 

S&P likely bullish up into 2860-5 into early next week based on yesterday and today

VNQ-  REITS breaking out and generally a very defensive tone all week-  BUY UTES, REITS.  Avoid TECHNOLOGY

Dollar breaking down-  UNDER 96.31 is negative

EURUSD expect to move higher up to 1.1509-1.155

Gold, Crude stabilizing and trying to bounce

VIX breaking 13 into weekend is a temporary negative for implied volatlity. Expect VIX to move down to 11.50-12 then likely turns back up mid-next week

 

 

S&P made 4 straight hours of closing well up off its lows on hourly charts-   of course, this wasn’t important today until S&P got above 2847

This helped prices extend

 

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VNQ-  the REIT ETF.  Breaking out to highs for the year today

The LONGS listed in todays report- VNQ,  VER, VTR, WELL, are all REIT PLAYS.  And extending.

Many more participating today now that prices have broken out-  and should continue to be attractive

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VIX-  A negative break of 13 in what many would agree is an hourly Head and Shoulders pattern from earlier this week

Pullback to near 12 is likely-  This could be an area to buy implied volatlity mid-next week

 

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LINKS

 

Link to Thursday’s Technical Webinar- discussing SPX, NDX, XLF, XLI, XLK, Europe

https://stme.in/L3MxzJPlkq

 

My Real Vision Interview on markets and MHK being a housing related Short

https://www.realvision.com/snapshot-home-wrecker?utm_source=Mark%20Newton&utm_medium=Social&utm_campaign=43328_CONREF_JS_SMT_RV_W1_MNewton

 

My Bloomberg interview from Wednesday- talking SPX and no evidence of contagion from EM stress

https://www.bloomberg.com/news/videos/2018-08-15/what-the-recent-risk-off-sentiment-means-for-market-technicals-video

 

 

Have a Great weekend all

 

 

Mid-day Thursday Video, charts of interest- Links to Webinar, and Bloomberg Interview from yesterday

Thursday mid-day Video- Short- 5 min-  SPX, TUR

https://stme.in/o29zgoEBVM

 

Link to Thursday’s Technical Webinar- discussing SPX, NDX, XLF, XLI, XLK, Europe

https://stme.in/L3MxzJPlkq

 

Link to My Bloomberg Interview with Abigail Doolittle, 8/15/18- - Discussing whether EM carnage could lead to contagion in US

https://www.bloomberg.com/news/videos/2018-08-15/what-the-recent-risk-off-sentiment-means-for-market-technicals-video

 

 

 

Markets have risen above the last couple days highs, while bond yields have also risen and a minor bounce in both WTI and the Metals.   So nearly opposite of what happened yesterday on all.

Breadth is a much stronger 4/1 positive today.. and while structural issues remain with the indices and with sectors like industrials, financials, these have made sharp snapbacks today that are adding 1%

Staples and Telecom are the best performing sectors, though all 11 sectors are positive which is the first time in the last couple weeks we’ve seen some broad-based strength.

Being above 2843 keeps near term trend positive while any pullback back down under 2825 would put bearish scenario right back on the front burner.

Unfortunately the last month has been largely range-bound with huge spikes in both directions, so a source of concern for both bulls and bears given the lack of any real trend.

 

New longs to consider:   SQ, TNDM MNST, LH, MDT, AMH, GRMN

Shorts:  use bounces in CVS, PCRX, CZR, WYNN, LVS, WYND, MAR, SDRL, ITW to sell

 

 

 

XLK-   Not the best picture of stability, but trends held where they needed to yesterday and now today’s snapback

2 areas of support-  72.15.. and then 70.32

 

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TUR-  Bounce tentative.  Mnuchin saying US will put more tariffs on Turkey causing 3% decline today in TUR, as this has turned back lower, despite some stabilization in most of the world in EM