Daily Archives: April 24, 2017

Post Mortem

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When the globex markets opened on Sunday afternoon, I was shocked. At the time, I had just returned my rental car at Dulles, and as I fired up my TOS app and saw the ES up about 24 points, I just about toppled over backwards.

What was shocking, of course, was that the “baseline” event – – – the high-likelihood outcome that everyone expected – – had happened, and yet it was created an explosive up-move in equities (and trashing gold). As I lamented in the wee hours of Monday morning, when I was miserably working my way out of SFO back toward home, a bullish pennant was complete.

0424-esd

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Low Volatility is Crucial for SPX Breakout

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Even though the S&P 500 Index (SPX) did not reach a new all-time high today (Monday), the SPX:VIX ratio did, as shown on the following two Daily charts.

Keep an eye on the ratio, since an RSI above 50 and upside crossovers on the MACD and PMO indicators are signalling that a new bull market is shaping up for the SPX. Such a breakout would need to be confirmed by a bullish crossover on the PMO, with the crossover maintained on the MACD and the 50 level held on the RSI on the SPX.

The 5dma Three Day Rule – Day Three

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ES/SPX found support where expected on Friday and reversed back up towards triangle resistance as expected, and then gapped over that at the Sunday globex open and the SPX RTH open, which was not expected. The triangle may be breaking up with a target at the retest of the all time high, and the opening gap up from 2355.84 is a candidate breakaway gap into that retest. There is a possible high here, but bears need to break down hard and fill that breakaway gap, ideally today, at latest tomorrow. Otherwise SPX likely retests the all time high. The 5dma is currently at 2351 and is likely out of reach for a close below absent a serious news bomb today. SPX daily 5dma chart:

170424 SPX Daily 5dma

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Old Faithless

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I’m sure everyone’s on the edge of their seat about my sleep schedule, so I’ll get that out of the way – – I got into bed at 4:30, fell asleep at 5:00, and was up again (thanks, dogs……..) at 6:00. Yeah, they let me sleep in. Anyway, as you might guess, it’s not a great day for ol’ Tim, but there is one bright spot: crude oil.

I’m a bit obsessed with crude, and it’s falling away nicely from a fairly meaty topping pattern (tinted in green):

0424-oil

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