As the S&P and NASDAQ makes new highs, there seems to be less exuberance in the more risk-on small caps. As seen below, the Russell 2000 Index has been mostly trading sideways for 2 months now. There is a significant divergence that has taken place between the large-caps and small-caps, as indicated in the following: … Continue reading Convergence play?
spx
Dollar Euro Gold
The Dollar breaks out against Euro as ECB flips On Thursday the ECB flipped. After Powell lead the way in January it was about time for Mario to follow suit. After announcing a few dovish policy decisions and most notably that rates would remain unchanged until the end of 2019, the Euro sank to levels … Continue reading Dollar Euro Gold
The Short Side
After 19%+ in two months, oversold conditions have run overbought. So far to be short in 2019 has been a less than fruitful venture, to say the least. Since Christmas day the S&P500 took off and never looked back. Breaking through 2,500 2,600 2,700, and while closing above 2,800 a couple times in the past … Continue reading The Short Side
Sell the News?
After the "worst December since the Great Depression" equities have recovered from their extremely oversold levels. The S&P500 posted a ~ 8% gain during the month of January. Since December 24 SPX has rallied almost 20% from 2350 back to 2800, with only 11 of the last 40 sessions closing lower than they opened. 2800-2817 … Continue reading Sell the News?
The Powell Put in Action
The January 30th FOMC press conference was greatly anticipated by market participants, generally looking to see how dovish Powell could get in the light of uncertain financial conditions and signs of a global slowdown. This is a recap of last meeting: Language: Powell starts off his conference indicating that the "economy is in a good … Continue reading The Powell Put in Action
SPX top, Treasuries and Dollar Rally subdue GOLD
SPX Topping; a new lower high This week has been less exciting for equities as the major indices have failed to rally above last Fridays highs. As we look at the S&P 500 its easy to see that overhead resistance is becoming a large contributor to the days price action. Lets remember that in high … Continue reading SPX top, Treasuries and Dollar Rally subdue GOLD
GOLD vs Dollar
Dollar Bounce: $95 technical support Lets recall the 4 major components of the Dollar Currency Index $DXY, by weight: Euro (EUR) - 57.6% Japanese Yen (JPY) - 13.6% Pound Sterling (GBP) - 11.9% Canadian Dollar (CAD) - 9.1% Now we can see that the DXY bounce is primarily as result of Euro depreciation, relative to … Continue reading GOLD vs Dollar
The Ultimate Short Setup?
Christmas eve posted a -2.06% day on the S&P500, when markets opened again on the 26th we closed up 4.43% (more than 100 S&P points). The DOW posted up 4.67% (+1,020 DOW points). Is this how we bottom? I don't think so. Since the Dec 26th intraday bottom of 2346 on the S&P, we … Continue reading The Ultimate Short Setup?
$TWTR
$TWTR bounced again off $26-27 reaffirming support. Looking at resistance in $34-36 range.
Some thoughts on 2019
Equities will be volatile and the bear market is upon us: If indeed Sept was the top of this bull market and we are headed into a well needed reversion to the mean; expect 2019 to be a volatile and dangerous year for equities and risk assets across the board. Structural flaws will become apparent … Continue reading Some thoughts on 2019
