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On Thursday I mentioned that VIX and VXX weren't confirming the seemingly bearish action on indexes, and Friday that view was proven correct with a decent up day.
QQQ blasted through the YR1 area that had been resistance the last few weeks. However, DIA could not reclaim its Q2P.
As usual more coming up on the blog.
Bearish action on all 5 USA main indexes today.
Leader IWM rejected from MayR1
QQQ tried to clear YR1 and couldn't
SPY MayR1 rejection
DIA QP rejection (said yesterday that level would be the tell)
NYA D200MA break after big recovery yesterday
However - this may not be quite real because VIX and VXX did nto confirm the move at all. We have seen other end of month days that are weak and snap right back in the new month, so I'm willing to say perhaps not as bad as the list seems above.
I would definitely change my mind with VXX above HP and VIX rallying above YR - that would be definitely bearish.
New June pivots in play tomorrow - those will also help sort things out.
IWM, DIA and VXX below.
While I didn't claim a total bear victory yesterday, I did think there were more negatives than positives. But the market proved otherwise with a massive comeback. Leaders IWM and QQQ starting the day above all pivots was the first clue, and then VXX fading back under its HP in the first hour was the next.
QQQ has been testing its YR1 since 5/10. There have been several selling attempts from this level. But the market has come back again and again. Compare the last few weeks to the YR1 rejections of late January, late February, and March. This time it seems like the market wants to clear.
DIA will be the tell for tomorrow - still testing QP.
SPY, QQQ, DIA and VXX below.
Finally the breakdown I have been anticipating for the last 2 weeks happened. However, it was not everything the bears could want and there is some chance of a bullish scenario.
The +s
IWM held above YR1
QQQ below YR1 but not much rejection
SPY held QP
The -s
DIA QP break
SPY MR1 rejection
NYA testing HP
VIX launch from YP to above YR1
VXX back above HP
In addition, XLF hammered, a lot of international indexes under pressure due to DXY strength, and TLT +2% above QP. That is not the move Wall Street has been expecting - TLT +2% and XLF -3% in one day.
So although the leaders have not caved I think there are a lot more -s and +s here and conclude this is not a one day wonder, and likely lower prices ahead.
IWM, DIA, XLF, VXX and VIX below.
Indexes mostly sideways, but VIX perking up. As usual I'll try to figure out the next move on the blog.
SPY and VIX below.
For the second day in a row, the market could have dropped but didn't. This usually means higher prices ahead.
DIA held QP on another test, and QQQ looks ready to take out its YR1.
No doubt today put my bearish thesis to the test. Markets could have seriously broken down but instead held in impressive fashion:
DIA held QP
NYA held QP
QQQ was -1% overnight only to rally all day and finish at the highs and back above all pivots!
SPY had MR1 rejection only to reclaim it on close.
This is almost enough for me to scrap the bearish view. However, QQQ is still below its YR1 and VIX above its YP. If those both go then yes I'll think indexes are going higher until the next resistance cluster.
QQQ, DIA and VIX below.
Today DIA and NYA reversed their bullish developments of yesterday. SPY was largely unchanged. IWM while down is still above its YR HR QR cluster.
But nearly every day over the last two weeks I have been mentioning 3 big yearly levels - QQQ YR1, VIX YP and IWM YR1. While IWM cleared, the others did not.
QQQ saw another rejection from YR1 area, and if we look at VXN it seems that smart money is indeed thinking tech is about to drop further with a decent hold of YP HP area. So far they are very correct with NQ -.5% after hours as I type.
SPY, QQQ and vXN below.
Today my bearish bias in the latest Total market view was called into question with DIA and NYA launching convincingly above Q2Ps instead of breaking down as anticipated. SPY also moved back above its MR1, and IWM continued to soar above its YR1 HR1 QR1 combo.
Other yearly levels I have been mentioning are still in play - QQQ YR1 and VIX YP. But given the other index improvements have to say there is more chance of a bullish resolution.
SPY, DIA and VIX below.
There have been signs of a tradeable move down after then 5/14 top, but so far after 1 day of selling on 5/15 not much further downside. And of course the Q2 leader main index leader IWM made new highs later in the week.
Things are very much a toss up in terms of the next move and as usual I will try to sort it out over the weekend.
SPY and DIA below.
Interesting day. Of the big levels I have been mentioning this week -
IWM YR1 - cleared, huge win for bulls, BUT
QQQ YR1 acted as resistance
VIX YP held as support
In addition, SPY MR1 looked like resistance, DIA MR1 also resistance yet held QP as support, and NYA somewhat similar with near test of MR1 while holding QP support.
VIX looks like stock selloff about to start, VXX is in favor of the bulls.
From this list you could say stalemate continues. But if using weekly pivots there is a slight edge to the bulls.
SPY, QQQ, IWM and VIX below.
The last two days I have mentioned that bears didn't get everything they would want on the recent turn, and today that view played out.
In the last USA main index post over the weekend, the summary section said this: "Indexes are at resistance in the context of a bull move. The task is to judge the likely path - immediate clear (less likely to my eyes), pause or small pullback then clear (possible), or decent drop (also possible).
Immediate clear did not happen, as expected. Of the latter two options, so far it is looking like pause or small pullback. But the clear hasn't happened yet either. The big levels in play from here:
IWM YR1
QQQ YR1
VIX YP
Also in play: SPY MR1, DIA MR1 and QP, NYA MR1 and QP, and VXX HP.
IWM, QQQ and VIX below.
Themes of the year continue today - stocks mixed, commodities namely oil up, bonds weak.
The question for most readers will be is if stocks just made an important trading turn. Obviously signs compared to yesterday have definitely increased with QQQ YR1 rejection, VIX YP hold, and NYA QP slight break.
But bears didn't get everything today, and you could view this as simple pullback to SPY WP (weekly pivot) after a fantastic run. In addition, DIA held QP on the close, and VXX stopped cold at its HP, remaining under all pivots except DP.
My bias is bearish because I don't think QQQ will close outside its quarterly Bollinger band, and I think we just saw professional selling near the monthly close high of 169.40 on QQQ. That said, for any serious decline we will need to see more USA mains below weekly pivots and VXX confirm the selling by recovering its HP. In addition, DIA has been a great indicator as it historically often is, so a real decline will mean DIA moves under its QP with the look of rejection. For today, it held.
But with massive hold of YP on VIX, together with QQQ YR1 rejection and IWM cluster rejection, maintaining all longs seems not quite right either. Yesterday I mentioned taking profits from recent entries of 5/3-4. So far that has been the right thing to do.
PS: Bitcoin moving below all pivots tonight as I type and first major support is in the the 3000s.
SPY, QQQ, DIA and VXX below.
The big levels in play mentioned in the latest Total market view all have the same status -
QQQ YR1 - price reached above but closed below
VIX YP - still above
IWM YR1 HR1 QR1 cluster - tagged HR1 and near tag of QR1, then reversal down
However - VXX lower, VIX not that impressive a move, TLT below MP, SPY and DIA holding MR1s as support are all points on the bull side.
So far we have a few signs of possible turn but not the usual confirmations such as strength in safe havens and multiple main index level rejections. Therefore jury is still out whether we have just seen a turn of significance.
IWM led in Q2, reclaiming above all pivots as early as 4/12 and maintaining that status since then except for a fractional break on 4/30. But it led down today so perhaps the simple move to reduce on the long side is take some profits.
SPY, QQQ, IWM and VIX below.
Indexes up with bulls in charge, but most of the levels mentioned yesterday still in play.
SPY MR1 (MayR1) - closed above
QQQ YR1 - pause no rejection
DIA MR1 / QP below
IWM YR HR QR combo cluster
NYA MR1 / QP just below
VXX collapsed under MS1 and 2nd day below all pivots since 2/1. VIX on YP not quite the same move; it has closed above its YP since 1/29. This along with QQQ YR1 will be the big tells for the next move. As usual more on the blog over the weekend.
SPY, QQQ and VIX below.
Bullish comments from Friday 5/4 have played out (likely a featured post on this soon). But suddenly quite a lot of major levels in play.
SPY tagged MayR1
QQQ back to YR1 - major decision here
DIA back to QP, slightly above but not definitive
IWM near YR1 HR1 QR1 cluster
NYA also slightly above QP, not enough to be definitive
Unfortunately VIX and VXX are not really helping, as VIX is seeming to suggest a turn for stocks with small decline above its YR1, while VXX is not - back under all pivots for the first time since 2/1.
Oh yeah - USO near YR2 area.
So there a lot of levels here and as usual we are trying to observe the reaction from these levels to determine the best positioning - just like shorting or hedging 4/30 then buying back on 5/4.
SPY, QQQ, IWM, VIX and USO below.
Major win for the bulls today with SPY joining QQQ and IWM above all pivots. Only IWM is on a resistance level which means the market should go higher for the next top of significance.
In addition, VIX and VXX confirming the move in stocks. At most highs these will signal a top by moving up along with stocks showing increased hedging activity from the smart big players.
SPY and VXX below.
SPY stuck under QP. Other than IWM, USA indexes had weak advances. Often such moves are a prelude to selling. But as long as DIA above MP, NYA above HP, VIX below YR1 and VXX not threatening, I give the bulls the benefit of the doubt.
SPY below - the only one of the 5 USA mains sitting under a major resistance level. If all of them looked like this I'd be sounding a more bearish alarm.
Follow through from Friday's move is positive, but the bulls did not get everything today as the move stopped cold on the SPY QP. That said the move does not look like rejection, other indexes are not on levels, and VIX / VXX not signalling trouble. So at this point I think there is a decent chance that SPY pushes through its QP.
SPY below.
5/3/2018 Daily comment: " The door is open for the bulls to rally back - we'll see what happens."
And rally back it did, with huge hold of long term support levels:
SPY D200MA hold, along with 1HP the prior day; also above MP
QQQ convincingly back above all pivots
DIA D200MA hold, along with 1HP the prior day; also above MP
IWM was already above QP and MP, lifted above WP as well - above all pivots on all timeframes
NYA back above HP and D200MA slightly, test and hold of YP the prior day
Bulls will want to see SPY join QQQ and IWM above its QP next week, but let's be clear - huge bull win on Friday. As usual more on the blog over the weekend.
SPY below.
