11/21/2017

As VIX and the daily comment tipped off yesterday, indexes cleared resistance. "Certainly the safe haven moves point to direction of indexes clearing resistance in the near future."

SPX consolidated in the YR2 / 2HR2 / Q4R2 cluster from 10/20-11/20 and the only damage was a very mild pullback to NovP which quickly bounced and zoomed to new highs a few session later. Today was the first day with a convincing close with resistance "looking like" support, especially so on SPY.

It is true I have been expecting more of a pullback from this SPX YR2 and NDX YR3 area, and today that was really proven wrong. That said, hedges have been a mixed bag - IWM short, possibly EWZ short and UVXY all gained; SPY, EEM, and very recent SMH shorts along with GLD longs were small losses.

So yes, I would have made more if fully committed to the bull case or bought aggressively on last week's low on the November pivot. Also keep in mind that I have been pointing to China especially KWEB from Dec 2016, and more recently FXI in August, as favorite longs, along with some longs in INDA as well. 

FXI today +2.68% so these little sub -.5% dings don't bother me when main portfolio winner is up 5X+ that today, and SMH per top of buy list in August is up 20%+.

New position: TLT. Rally above YP that held as support. Interesting trade. Probably from here I will try to emphasize safe haven longs more than index shorts, because the longs tend to be easier; except in the cases of a very good risk-reward UVXY setup. 

Levels to watch from here are NDX/QQQ YR3 and RUT/IWM YR1.

SPY, QQQ, FXI, TLT, VIX and XIV below.

11/20/2017

SPX and SPY still stuck in this resistance cluster, and YR3 remains near the exact high on QQQ.

However, VIX dropped below all pivots, XIV cleared 2HR2 again, and other safe havens weakened. I keep thinking the stock indexes will finally drop, but they don't. Certainly the safe haven moves point to direction of indexes clearing resistance in the near future.

SPX, SPY, QQQ and VIX below.

11/17/2017

The markets are at a very interesting juncture - SPX/SPY YR2, NDX/QQQ YR3, and TLT YP.

Weekly SPX & SPY charts look like selling bars - bears have an open invitation for next week.

As usual more coming up on the blog.

SPX W, SPX W, QQQ, W, TLT W below. 

11/16/2017

Wow - market continues to humble anyone who starts to think about a pullback of more than a few days and few %s. While I did expect a bounce yesterday, I thought it would be weaker move. 

Though gains were impressive it is not a total victory as the resistance areas I have been pointing to are still in play.

SPX/SPY - back above YR2 and 2HR2, definite positives; at Q4R1
NDX/QQQ - testing YR3!
RUT/IWM  - still under NovP, near 2HR2
NYA - still under NovP

VIX dropped below 2HP, also a definite positive, but fractionally below Q4P. 8/22 was different, with a drop that fell below all pivots. Similarly, XIV closed fractionally above NovP but not with look of support.

Had I been convinced of bull case I would have pounded table on buys yesterday - oh well. Keep in mind that VIX had closed above a long term pivots for only the 7th time this year and I thought a deeper pullback was in the works. From here watching levels above, especially NDX/QQQ YR3. 

SPY, QQQ, XIV below. 

11/15/2017

For those who have been expecting some broader weakness in markets, finally - but even today came back quite impressively and there could have been a lot more damage. 

From the latest USA main index post on the blog: "SPX / SPY testing YR2 / 2HR2 combo 2576-82, with SPX holding this area as support a couple times last week. Bullish to be holding level, but anything lower would look like yearly level rejection and open the door to NovP at minimum."

And that is exactly where SPX went, as NovP was near the lows; Q4R1 also nearby on SPX acted as support. With daily RSI the lowest since late August, near the bottom of the daily BB, all but the 10MA still with rising slopes, and both a monthly and quarterly level holding, I am thinking some bounce is the next move. Ideally this is a weak bounce and goes lower but that is just opinion right now. The important thing is that NovP held and SPX/SPY remains above all pivots when it could have broken.

DIA, QQQ and VTI remain above all pivots as well. NYA was part of the tipoff for the downdraft, below its monthly pivot for the first time since 9/5 on 11/13. But it is the global names dropping most, and as this was part of my expectations for the week it was easy to take some gains on the remaining FXI longs (bailed on INDA earlier). 

Though SPX held, we don't have a good buy signal. VIX is above the 2HP and XIV broke its NovP. XIV may rally from here with rising D50MA and NovS1, but again, i'm thinking some bounce and another downdraft. I'll remain cautions with VIX above the 2HP; but rejection back under that would be a different story. 

TLT again rallying to the YP, a key level to watch for tomorrow. In contrast metals this week have been terrible which considering indexes stock and DXY is rather odd. TLT could be taking the lead for key safe haven trade - in addition to volatility, of course. UVXY rec'd 11/8 on twitter +16% so far. A decent enough position on that makes up for a lot of other portfolio, if simultaneously convinced of short term weakness while most USA indexes remain above all pivots. A great move. 

SPX, SPY, VIX, XIV and TLT below. 

11/14/2017

Amazingly, another drop below key levels and another comeback to hold. SPX dipped below its YR2 for the 3rd time this month and instead of turning into rejection rallied back to close above. Similarly, VIX held 2HP resistance also for the 3rd time this month. 

DXY was crushed but the biggest losses were in the emerging markets and Brazil EWZ especially. 

For USA mains it was another save by the bulls. I'm thinking we will see breakdown before new highs but market strength has surprised me the last few weeks. We'll see what happens.

SPX and VIX below. 

11/13/2017

Have to hand it to the buyers - another day that very easily could have been negative, but just wasn't. 

SPX again held YR2 as support; VIX held 2HP as resistance and dropped back under Q4P as well. XIV held above all pivots.

Other safe havens TLT and GLD could have been stronger but weren't.

However, VIX did not close under its NovP and the normally reliable NYA closed under its NovP as well.

My conclusion from the latest Total market view was that it was a week to stay agile; limited upside, yet possible test of highs before a bigger drop. This is still the case. Also, I am still thinking that NDX still top out on YR3 and more emerging market currency volatility is likely.

SPX, SPY, NYA, VIX and XIV below. 

11/10/2017

SPY and SPX have very different looks and conclusions. This is annoying but sometimes happens. Trust me, i did lots of research to settle on 'one' version of all these things and in the end decided a weight of the evidence, multiple main index and safe haven system of analysis, gave the best results. 

SPY under YR2 acting as resistance the last two trading days, and SPX above YR2, acting as support. As usual I will try to sort out the real picture on the blog.

11/9/2017

All the ingredients for a trend down day were there - deteriorating internals, bond market jitters, small caps already leading the way, and volatility in Asia. But at the end of the day, SPX stayed above all pivots and held YR2 as support; VIX traded through NovP and Q4P to 2HP, and finished below all pivots; XIV tested NovP and had a huge comeback. 

This doesn't mean the resumption of relentless uptrend. I view this as part of a topping process. SPY looks quite different from SPX and we'll soon see which version wins out. The last total market view suggested IWM and EEM as hedging vehicles, and this week GLD moving above all pivots is also a safe haven contender. 

SPX, SPY, VIX and XIV below.

11/8/2017

SPX/SPY is holding YR2 as support - bullish. Despite threats from an array of assorted factors - IWM, TLT, HYG, GLD, new lows - so far bulls still in charge. 

SPX, SPY and XIV below - note, if market were to drop then 2HR2 on XIV would be resistance, and most definitely YR2s on SPX & SPY would be breaking. Both not happening. 

11/7/2017

The market has been bifurcated over the past week or so, and today these themes just became more dramatically emphasized.

Still in + column
SPX/SPY holding YR1 as support!
DIA and QQQ both positive today
VIX below all pivots, XIV above all pivots and holding 2HR2 as support!
FXI new highs
 - Just cannot be too bearish

-s
TLT above all pivots; HYG high 10/23, 2nd break of Q4P 11/1 - cannot say no warning
IWM below NovP each trading day this month, along with YR1 near tag & rejection
INDA one of 2017 leaders got whacked
EEM Q4R1 rejection (second time)
 - Too much to ignore

So what will it be? Not sure. Metals made a move Monday, then retreated. In addition to all the usual suspects (USA mains, VIX and XIV), I'll be watching GLD, GDX and SLV. IF they gain strength, the picture for risk is worsened. 

It does feel a bit 'different this time' with many of the signatures of pullbacks already in place - some pivots level rejections (not all though), safe haven strength, HYG weakness, RSIs overbought across timeframes, elevated sentiment, new highs already deteriorating and new lows already increasing. But SPX holding above YR1 / 2HR2 combo 2576-82 still looks quite strong.

SPX, SPY, XIV, TLT, IWM, HYG below.

11/6/2017

Market levitation continues with SPY, QQQ and NYA all trading above Q4R1-2s. XIV also continued above its 2HR2 for the second day. 

IWM remained under its NovP, TLT strong and HYG weak. 

Metals bounced but did go quite enough to definitively clear key levels.

Seems like something should give - either stocks should pullback or TLT should not be as strong and HYG not as weak. 

SPY and HYG below. 

11/3/2017

Big development today - SPX launched above YR2 / 2HR2 cluster. SPY looks a bit different - some variations between cash and ETF making its levels a bit higher. Still, cash index move is a win for bulls. 

11/2/2017

SPY is still under its resistance cluster, but SPX has managed to stay above YR2 for the second day (while remaining under 2HR2). Another point of weakness is that IWM is below its NovP.

But looking at safe havens, I give edge to stock bulls in coming days. VIX tested and held NovP as resistance as XIV held near test of NovP as support. GLD and GDX tested Q4P and 2HP respectively, and both were clear resistance. 

TLT was up but still under Q4P; AGG up but still under YP; only HYG is sending some alarm to stocks. 

Due to major levels involved on SPX/SPY combo at YR2 and IWM YR1 rejection, this is still a day to day assessment of the more likely move. As of yesterday I thought we would see further weakness and was recommending a rare UVXY hedging position. Today the market dropped but came back as XIV held NovP and rising D20MA combo. Now it is back to bulls having the ball.

SPX, SPY, VIX, XIV below. 

11/1/2017

I have been going on about yearly levels since mid October - INDU YR2, SPX YR2, RUT YR1. First this seemed like a needless worry - though INDU has had major turns on yearly levels every year since 2005, the index powered through YR2 without even a day of pause. But SPX did have some selling from YR2 area, and an equally fast comeback. Now again there has been some selling from this SPX YR2 / 2HR2 cluster, and today the emphasis was on the RUT YR1 rejection.

A few Pivotal Perspective basics:

• indexes on long term levels increase the chance for an important turn or definitive move
• the more main indexes the give the same message, the more reliable the signal
• key turns are often confirmed via other technicals, safe havens, sentiment, valuation, timing
• for a complete top assessment, please go to the FAQ page and search on 'top checklist' and then look for more recent posts

Regarding first point, it sounds simple but cannot be understated - consider high of year on EURUSD YR2 exact this year, or the low in TNX on YS2 in 2016, the low in stocks across the board on several YS1s & S2s .... the list goes on.

And over the last few weeks the market has been near INDU YR2, SPX YR2 and RUT YR1. 

As mentioned in other posts, several other indexes have cleared YR2s so given seasonality it is certainly possible that SPX will join INDU and NDX in that status. But it is also possible that a key turn is in the works, and it is our job to assess that likelihood and then determine correct positioning given that probability. 

Today SPX closed slightly above YR2 - a definite positive - but still fell back from 2HR2 level just above. The resistance on SPY is slightly different and there was clear selling from the YR2 level. RUT/IWM got whacked, and even closed below its NovP. In addition, XIV looks like rejection after high test of 2HR2 and this could lead to another drop. There is enough here for more near term weakness. 

SPX, SPY, ES1, IWM and XIV below. 

10/31/2017

For the 8th trading day in a row, SPX remained under its YR2 / 2HR2 resistance cluster. Thus far one selling attempt and one comeback. 

November will likely open above all pivots for the USA main indexes. 

SPX long term only pivots below. 

10/30/2017

While today was not a total reversal, there are enough warning signs to be on alert.

If you look at SPX or SPY without any pivots, it seems like a smaller red pause day after healthy advance and it would be difficult to be too bearish. 

But if you add in RSI, then there is some caution because of the clear selling at 70 level. 

Now add pivots. That's right, the 2HR2 / YR2 combo is still resistance. SPX tested the 2HR2 level on Friday, but today dropped back under YR2. This is potentially a big deal.

I don't think many people are looking at charts and thinking this could be a major high for the year. But I am. 

If so then we will see bearish action on multiple USA main indexes and a confirmation with VIX and XIV. While XIV also suggests selling, the full sell signal hasn't happened yet. Still, watch carefully.

SPY (also showing 2HR2 / YR2 rejection) and XIV (2HR1 resistance) below. 

10/27/2017

For the last three weeks I have been expecting some selling reaction from INDU / DIA YR2 and then SPX / SPY YR2. INDU soared through its level without any resistance. But this week SPX did reject its YR2 and for a few days hedges looked to be the right move. 

Hedges were about even in the end, so this isn't really a matter of taking a hit to the account. And the next time the market is on big levels while being overbought at a relatively high valuation I will probably hedge again! 

But right now it seems like the market is primed for more melt- up. As usual a lot more coming up on the blog over the weekend. 

SPX has started to clear its YR2; SPY testing. We'll see what happens. 

10/26/2017

Not much movement in indexes today, and the big move was in $DXY and metals. 

$DXY rallying above its Q4P for the second time is pressuring the global indexes that The Pivotal Perspective has taken great advantage of since March. 

Latest Total market view thought next move would be capitulation / breakdown in safe havens TLT and GLD etc. This idea is doing quite well this week. As these safe havens crumble, the only place to go is VIX which is above its OctP for the 4th consecutive day.

Current view: Upside limited for stocks, trimming some global indexes seems like good idea, short TLT and maybe metals from last week and early this week, moderately long stocks via hedge on QQQ, IWM and/or SPY is doing fine.

SPY, TLT, GLD, GDX, SLV and VIX below.

10/25/2017

From the beginning of this week, we have seen SPX YR2 rejection, XIV 2HR2 rejection and VIX above a monthly pivot for the first time since August.

A cautious approach is warranted, and via Total market and tweets I have suggested QQQ short on the day of the highs last week, UVXY if XIV dropped below 2HR1 which it did on Monday; and if this wasn't enough of a portfolio hedge, then SPX/SPY provided the perfect setup on Monday with YR2 rejection.

In early stages of a decline off a relentless trend it is difficult to be too bearish. Total market views have been more bearish over past 3 weeks, and wrong the first week, half-right the second on QQQ and IWM, and looking more correct this week. With SPX YR2 and IWM YR1 rejections  happening, we must consider the possibility that key highs are in. Yet with trends persisting, strength in the leader INDU/DIA, and VIX rejection from both 2HP and Q4P today, it could mean another high test in the making or simply that markets will not go straight down.

Best guess from here is limited bounce soon then lower. VIX is the key - if below all pivots on daily close, have to be bullish. Above OctP, cautious warranted. 

Last note - often what holds up the best in a decline is the next leader. FXI and INDA both positive today; FXI held near test of YR2 as support, and INDA also above YR2 looking ready to breakout up. 

SPY, VIX, FXI and INDA below.