Please enable javascript in your browser to view this site!

Market's pullback post European close echoes yesterday ahead of FOMC, BOJ

Past mid-day, a very similar picture to yesterday, as equities have given up all early gains, most of Europe finished down, Bonds continue higher with US 10yr yields down to 1.671 and Bund yields back to negative, dropping back to -.018.  Breadth is minor negative, with Declining volume leading Advancing volume by nearly a 2/1 margin-  Energy, Materials lagging the most of any of the 11 sectors, while Healthcare and Staples higher by a moderate 0.30-0.40%.  WTI Crude has pushed back to positive territory after early weakness, and Gold largely flat-  Overall, Very little net change in S&P for the last few days, and still very much range-bound with a bearish bias given this week's negative seasonality trends-  DOWN 20 of last 25 years, while some evidence of Tech and Financials starting to weaken a bit after recent strength-   For now, 2127 important for Dec S&P futures, while 2147 on the upside, with a bias towards testing and breaking lows which could take S&P down to 2107 and then 2090 area before markets stabilize.  USDJPY has been incredibly range-bound ahead of the BOJ meeting, but overall a tough spot to take a strong stand on either Japan or US given the downtrends in place since August while near-term range-bound activity over the last week, not only in Equities but also Fixed income and the US Dollar index-  Let me know if you have any questions.

Still a very choppy range ahead of BOJ, FOMC, and for now, difficult to take a strong stand directionally ahead of any real breakout in either direction

 

 Election year seasonality over the next few weeks tends to be negative, so without considering FOMC outcome, there tends to be greater odds of this recent sideways trend breaking to the downside given that the last 20 of 25 years have seen DOWN performance in the week post Q3 Expiration  (Stock Traders Almanac