This Made My Day

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I have made no secret of my disdain for Theranos and Elizabeth “Crazy Eyes” Holmes by way of these six past posts. While driving through town, I passed by the gorgeous and expensive Theranos building, and  yesterday I decided to swing into the parking lot. I was curious, because the one and only other time I had been there, it was totally empty, which I found bizarre for a weekday. But I swung into again and…………

0622-parking

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Crude Oil Down 60% Since Mid-June 2014

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Crude Oil has fallen a massive 60% since mid-June 2014, as shown on the following graph.

Price today (Wednesday) fell below 43.50, which I identified in my post of June 3rd as a major support level, and closed at 42.53, as shown on the Daily chart below.

Increasing volumes are either signalling continued weakness ahead, or some buying stepping in between this level and 50.00. Since another bearish moving average Death Cross has formed recently, the first scenario may be favoured in the near term.

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Can Bonds Rally To New All-Time Highs?

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Since the Fed increased rates in December, the bond market has been rallying. Many have told me that the Fed controls all markets. Many have told me that you cannot fight the Fed. Many have told me that the Fed controls the bond market.

My question is if anyone has told the bond market this?

The Fed has now increased rates 3 times since December of 2016. So, if the Fed truly controls the bond market, and if the Fed truly controls the direction of interest rates in general, doesn’t that mean that overall rates should be rising?

Well, the bond market does not think so. Since December of 2016, the bond market has been rallying, as can be seen in the attached chart below of TLT. Yet, the Fed has raised interest rates 3 times during this rally.

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2 Longs & 2 Shorts to Watch

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By Harry Boxer, TheTechTrader.com
ImmunoGen (IMGN) reached a high of $5.66 and then closed back at $5.42, up 10.4% on Tuesday. Price has risen 18% in two sessions after a Leerink analyst raised his price target to $11 from $8. On Tuesday the biotechnology stock traded on heavy volume of 6.7 million shares, which is nearly twice its average volume and is the largest volume level for this stock in four weeks. Price is presently at resistance, but if it breaks through that level in its rising channel, the near-term target is $9.75.
Exelixis, Inc. (EXEL) gained 68 cents to close at $22.28 on Tuesday on 5 million shares, or about 50% greater than average. The move came following news that the biopharmaceutical company had successfully completed a phase II clinical trial for its kidney cancer drug, Cabometyx. Price exploded through its declining topsline, moving above lateral resistance and its 50-day moving average. Next targets: $23.50 and $25.
On the short side…
Cimarex Energy Co. (XEC) experienced a slight bounce and gained 56 cents, closing at $94.01 on 1.85 million shares traded. Price has declined every month since December and dropped by more than 20% since May 8 when it was $121.91. The energy stock may be oversold enough to get a significant bounce in this range, but eventually $82 and then $74 are next targets.
Yelp Inc. (YELP) declined by 84 cents, or 2.7%, to 29.44 on 1.9 million shares traded Tuesday. Shares have dropped by $6.26, or 17.5%, since the company’s May 9 earnings announcement when it offered disappointing EBITDA guidance for both 3Q and for all of 2017. On Tuesday price broke down from a bear wedge pattern on light volume. With follow-through, price may roll over to $26.50 and eventually to the $23 range.
No holdings.

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Mind The Gap

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I always enjoy using literary, philosophical or other references in the titles of my posts when I’m not summarising the central theme of the post in it, and this post narrowly escaped being entitled ‘The Curious Incident of the SPX in the Daytime’, before I decided that the central message of this post was too important not to be used as the title. The title would have been a reference to a quote from the famous Sherlock Holmes short story ‘The Silver Blaze’.

170621 SH

The point is of course that while NDX/NQ did almost exactly as I predicted in my post last night, reversing in the right area back to the retest of the daily middle band on NDX, closing a handle below it, SPX/ES and RUT/TF were left at the starting gate, both closing not far above the lows for the day. What does this mean? Well at the least it means that the possible extension higher that I was looking at on SPX/ES if NDX/NQ now breaks up towards the all time high retest is now unlikely, and if NDX/NQ breaks up here then I wouldn’t be looking for more than an all time high retest on SPX/ES, and likely not even that on RUT/TF.

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