The allure of “merger Monday” is upon the world, as the logic seems to be that if a Time-Warner/AT&T deal can happen, then why not have everyone merge at big premiums? We’ve definitely need this movie before.
At the moment, gold remains in a no-man’s-land in which it’s trying to decide whether to complete its tiny saucer pattern and try a (surely doomed) assault at $1300, or whether it’ll simply succumb to gravity and continue its fall. My only precious metals position is a medium-sized GDXJ short.
I haven’t posted the full set of charts that I do every morning for a while and these are the companion charts that I use in my premarket videos for Daily Video Service subscribers at theartofchart.net. I posted that on twitter before the open today (@shjackcharts), but if you missed that you can see that here.
On ES I was saying that the outlook remains bullish as long as 2146 remains unbroken, and the LOD so far is 2147.75. If that remains the LOD then the outlook still leans bullish. ES Dec 60min chart:
The bears didn’t have a good day yesterday, with a larger than expected decline on the indices, and clear breaks at the RTH on SPX close back below the daily middle band, the 50 hour MA and the 5dma, and ES losing the key weekly pivot area at 2152.25 that I highlighted as a key close area on a tweet yesterday afternoon. With the historical stats for the last day of September leaning 75% bearish, and the indices resting on key support levels the odds of the ATH retest on SPX that Stan and I have been looking for definitely looking lower, and you can see that reflected in the tone of my comments last night on the charts below.
Overnight though the picture changed entirely, with marginal new lows and 60min buy signals fixing on ES, NQ and TF, and with a triangle confirmed on NQ and a perfect bull flag channel established on TF. On my premarket video for subscribers to the Daily Video Service at theartofchart.net today I was leaning strongly bullish, and I’ve not seen anything since then to change that view. I’m thinking 50% odds or better that SPX trends up today. The direct link to that video is here. Hopefully some of you saw that when I posted that link on twitter before the open today.
I have a “moment of truth” every morning when I grab my iPad, bleary-eyed, from the side of the bed, to see what the ES is doing. This particular morning, I was bracing myself for +30 on the ES considering the Clinton momentum, but, happily, it’s only up 3 measly points at the moment. More important to me, crude oil is getting its shiny black bottom spanked, down about 2.7%. Some ridiculous rumor should be along any moment now.
The high window opens on SPX today and runs through to Monday 3rd October. During this period Stan and I are expecting to see a very significant high made that would then be followed by a decline that would be considerably larger than the modest retracement just completed. We are looking for a likely full retest of the all time high, with an eye on higher targets in the 2203, 2206/7 and 2210 areas.
On the daily chart SPX confirmed the break back over the daily middle band with another close above it yesterday. This opens a possible test of the daily upper band, currently at 2202. I’d generally expect to see a retest of the middle band from above today or Monday, and that is currently in the 2161 area. SPX daily chart:
With the BOJ last night and FOMC today there is likely to be significant market turbulence even with the likely net announcements not amounting to much. The Fed will reveal today where rates will remain at almost nothing, or be raised to slightly more than almost nothing, and while it’s a little hard to see why that should be particularly interesting, the markets will be watching that carefully nonetheless. Trade safe!
I’ve already done two webinars today so I’m going to save myself some time today by using the premarket video and charts that I did this morning for Daily Video Service subscribers at theartofchart.net. I’ve been doing the charts every morning there for a while but have recently added the video and that is being incorporated into the Daily Video Service next week, by which time we will have settled on a likely new name for the service that is a bit more catchy. The service also includes Stan’s post market update video and the private twitter feed which is updated during regular trading hours