Long Term Equities Update

It’s been a while since we’ve covered equities exclusively and as the month is coming to an end this is as good an opportunity to catch up. As you all know I have been dangling the ‘late stage bull market’ carrot for a few weeks now and quite frankly I don’t see any reason to change that outlook. I have been very adamant about expecting a final exhaustion spike higher and believe that is already in the works. Now before you start piling into puts be aware that we may be weeks, perhaps even months away from a downside event. So hold your horses and for now just enjoy the charts in preparation for where we heading most likely later this year. Enough weasel talk and disclaimers? Great – let’s get to the charts.

2015-02-27_zero

Actually it was the Zero chart that reminded me that a LT update may be in order. Over the past few sessions some of my subs and myself have been noticing strange signal patterns suggesting distribution. It’s very much possible but quite frankly I don’t see anything on the momo side that would suggest urgency. In short – nobody can predict when things will take a turn but we are a bit early in the game here still. So let’s review the evidence:

2015-02-27_SPX_LT

 

First the long term SPX with my trusted weekly stochastic. I almost never use this indicator – except on the weekly chart where it actually works pretty well! Right now we’re scraping 100 but in this bull market this means nothing. Most likely we’ll see an embedded signal (above the 80 mark) for a while before we head lower here. So no reason to be in a hurry – again we may be weeks or perhaps even months away.

2015-02-27_SPX_SPXA200R

SPX vs SPXA200R – the latter is the percentage of stocks in the SPX trading above their 200-day SMA. Now that one is looking bloody well divergent and eventually there will be a price to pay. But I don’t think that we’re due just yet (watch how the market will drop instantly after Mole’s statement).


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Bonus Chart!

022615pump

This one is courtesy of Chris Carolan over at spiralcalendar.com – one of the few other analysts I follow. Chris graciously permitted me to post this chart which I not only find absolutely compelling but also appears to be in line with what I’m presenting above. See the delay in the response on the S&P? Ponder on this one over the weekend.

Alright – I’m exhausted and am desperate for my Friday treat:

beer5

Not her you deviant! I’m talking about the Hefeweizen – which is waiting and that’s my cue. See you guys Monday!

Cheers,

The Squeeze

Forgive me if I’m going to make this one brief - I wound up having a pretty rough day fixing a series of technical problems. One thing lead to another and it quickly turned into one of those days. But enough of my trials and tribulations. Equities meanwhile are climbing steadily – perhaps emboldened by a falling Dollar and some hopium on the news front. Couldn’t just have been that the EUR was forming a base and that conditions were ripe for a snap higher? ;-)

2015-02-03_spoos_update

Anyway we’re now at an inflection point on the hourly E-Mini – clearly we’re going to see a bit of push back near 2040 but if it breaks above that NLBL the dynamics for a squeeze would be almost perfect.

2015-02-03_UVOL

Clearly the bots are back in the game – compared with previous sessions that UVOL curve is looking smooth and polished. A push higher from here is expected to trip a boat load of stops (mine in included as you recall – at least they are at break-even).

2015-02-03_copper_update

Fortunately copper is making up for the incessant gyrations on the equities side. That little ST entry yesterday already paid off in spates and I’m going to start trailing it at the 2R mark. I think we may have the potential for a runner here which is why I’m going to keep my stop fairly loose for a while.

No setups tonight – I didn’t see much I really liked plus I’m a bit burned out. Tomorrow is another day.

The future is now – so don’t bring a knife to a raygun fight. If you are interested in becoming a Zero subscriber then don’t waste time and sign up here. A Zero subscription comes with full access to all Gold posts, so you actually get double the bang for your buck.

Cheers,

Rejection

After six years of pain the bears are used to rejection near inflection points. Which is why we keep seeing those bounces just when it looks like the tape is about to fall off the plate. But in the past few weeks I keep thinking the same thing over and over: How many stick saves are we going to see before this thing falls off the plate?

2015-02-02_spoos_update

However, that said – the bears are starting to wear our their welcome. Yes, medium and long term tops take a while to form, but there comes the point when it becomes clear that there’s not sufficient selling pressure to take this dog any lower. That time is approaching fast now – if you project forward a few days: Let’s assume we get two or three more closes near the diagonal I painted on the daily (left panel) and we’ve effectively produced a bullish defense line. Odds for a bounce higher will increase rapidly now every day we remain above 1980.

I’m still short here from ES 2040 and won’t touch those until we fall off the plate or I get stopped out at break/even. It’s make or break time for the bears – let’s see if they blow it once again.

2015-02-02_VIX

The VIX also at the line of scrimmage  - that 23/24 mark has been holding thus far and supports the notion that we are at a technical inflection point.

2015-02-02_USDCAD_setup

On the setup side I’m actually taking my cues from the short term panels in expectations of turning them into daily campaigns. Here’s the USD/CAD which currently looks like an experimental long until about 1.256 – I want to be short below that.

More futures and forex setups below the fold:


More charts and commentary below for anyone donning a secret decoder ring. If you are interested in becoming a Gold member then don't waste time and sign up here. And if you are a Zero subscriber you get free access to all Gold posts, which gives you double the bang for your buck!

Please login or subscribe here to see the remainder of this post.

Cheers,




    Zero Indicator


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