The American stock market is the S&P 500 and the SPX prints a new all-time high at 3127.64 on Tuesday, 11/19/19. The SPX all-time closing high is 3122.03 on Monday 11/18/19. Sound the Seven Trumpets! The Dow Jones Industrials Index (DJI; DJIA; INDU), the Dirty Thirty, the most-watched stock market index by the American public, prints a new all-time record high at 28090.21 on Tuesday, 11/19/19. The Dow's all-time closing high is 28036.22 on Monday, 11/18/19.
Today is the big day. The Impeachment Hearings against President Trump continue in the House of Representatives in the US Congress. The drama is somewhat status-quo. The corrupt Democrat Tribe is tilting the scales every way possible to paint King Donny in a negative light and push the guy from office either before or in the November 2020 election now only 50 weeks away. The corrupt Republican Tribe continues to prohibit witnesses from testifying while at the same time proclaim transparent cooperation; they say there is nothing to see here except for the halo above Teflon Don's head.
Well, today, the rubber meets the road. One of the filthy corrupt tribes will win today and the other will lose and it will impact the stock market direction forward. Ambassador Gordon Sondland is testifying at the impeachment hearings and he has first-hand knowledge concerning the events in Ukraine. The president is accused of holding back military aid to Ukraine until the newly installed President Zelensky would announce in public that an investigation into Joe and Hunter Biden, and energy company Burisma Holdings, has started. Democrat Joe Biden is perceived as republican Trump's major foe in the upcoming presidential election (although his status is diminished during the scandal). Thus, King Donny was trying to get dirt on the Biden's and cause mischief in their campaign so his path to re-election was easier.
The democrats are just as filthy. Hunter Biden, who has no expertise in the energy arena, was placed on the Burisma board lining his pockets with hundreds of thousands of dollars. It helps that daddy has political clout and influence and was vice president at the time. It's easy to see why America's crony capitalism system is failing and is singing its final swan song during the coming months and few years.
The funniest aspect of all the impeachment drama is how it exposes the filthy rampant corruption among all politicians especially those within the beltway (Washington, DC). The final result of all the theatrics may damage both men. Biden may be viewed as corrupt with his son on the Ukraine energy board and his poll numbers are slip-sliding away. Trump may be viewed as corrupt as he uses taxpayer money to further his political and future monetary ambitions. This must be how crony capitalism finally implodes and ends. Capitalism fails because of human corruption and non-transparency just like all other ism's. It's not rocket science.
The plot thickens. Sondland donated millions to Donny's campaign and in return was awarded an ambassadorship to Ukraine (this is how the crony capitalism system works). Sondland likely regrets ever desiring such a position since his testimony, today, in only a few short hours from now, may determine the fate of the POTUS. It is amazing. Sondland will either sing a song like a canary spilling the beans on Teflon Don sealing the president's negative fate ahead for impeachment and the election, or, he may stick with Team Trump and perform Donny's dirty work defending the president. Sondland may support the president since if he gets into trouble over perjury or some other legal entanglement, and he goes to jail, he probably expects the president will pardon him.
The stock market idled sideways this week awaiting the outcome of the Sondland testimony which is imminent. If the Sondland testimony goes the way of the Democrat Tribe, Donny is toast. Republicans will begin jumping ship and drifting over to the impeachment side which would be the death nails of Trump's presidency.
If the Sondland testimony is not all that damaging for the president, and Gordy finesses his way through the hearing, the Republican Tribe will be throwing confetti and singing songs of joy. If Trump weathers this serious political storm today, his approval ratings will leap higher and he will pave an easy road to re-election next year. It's all on the line today. High drama. It is interesting that Sondland's testimony today will likely determine if Trump attains a second term, or not. Markets are watching and waiting.
S&P futures are down -11 and Dow futures are off -105 about 3-1/2 hours before the opening bell at 9:30 AM EST and less than 3 hours before the Sondland testimony. VIX 13.52. Gordy is set to testify at 9 AM EST before the House. The democrats want this story to be front and center all day long. This means that futures markets may be moving before the opening bell for the regular session. The tension and excitement mounts. Today may become messy.
The RSI and stochastics are overbot agreeable to a pullback. The red rising wedge patterns are ominous since the collapses from rising wedges can be quite dramatic. The red Ines for the chart indicators show all in negative divergence as price made the new high, thus, a spankdown is on tap. Remember, the uber low CPC and CPCE put/call ratios over the last couple weeks verify rampant complacency in the stock market and a significant top at hand.
The Aroon green line is at its max one hundo and nowhere to go but down which is bearish while the red line is at zero with nowherre to go but up which is also bearish. Watch the Aroon to see if the negative cross occurs which would forecast gloom ahead.
The brown circles show distribution taking place 8 times in the last couple months. That's the smart money handing off shares to the dumb money fools. Willie, that is popular with the ladies around the office, is bragging at the water cooler that he just bot AAPL and AMZN stock with his last paycheck. He cites all the record highs in stocks and tells everyone to buy equities right away or you will miss the train leaving the station.The smart money counts on the hype in the markets to allow time to distribute shares to Joe Fool, Jim Retail, Frank Sixpack, Bertha Bagholder and Sally Sucka.
Price has violated the upper band so the middle band at 3070 is in play as well as the lower band at 3K. The SPX is extended above its moving averages requiring a mean reversion lower.
Stock market history may be written today. It all depends if Sondland sings like a songbird, or not. Of course any positive, or negative, trade news and/or central banker announcements will continue sending stocks to and fro. The Senate passes a bill supporting the Hong Kong protests which is causing dismay with the Beijing communist leadership and jeopardizes the US-China trade deal. The US House and president will need to approve the resolution in the days ahead. Okay, Gordy, it is all yours today. It is time for your 15 minutes of Andy Warhol fame; take it away. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
Note Added 6:45 AM EST: S&P -13. Dow -115. Nasdaq -44. Russell -11. VIX 13.62. Oil +0.4%. Copper +0.3%. Gold 1477. Silver 17.28.
Note Added 7:11 AM EST: S&P -7. Dow -74. Nasdaq -26. Russell -7. VIX 13.37. Oil +0.7%. Copper +0.2%. Gold 1473. Silver 17.21. DAX (Germany) -0.7%. US Yields are; 2-year 1.58%, 5-year 1.59%, 10-year 1.75%, 30-year 2.22%. The 2-10 spread is 16.4 bips.
Note Added 8:14 AM EST: S&P -9. Dow -87. Nazzy -30. Russell -7. VIX 13.42. Oil +0.6%. Copper slips negative over the last half hour down -0.1%. DAX -0.7%. US Yields are; 2-year 1.57%, 5-year 1.58%, 10-year 1.74%, 30-year 2.21%. The 2-10 spread is 16.8 bips. The Housing Starts yesterday missed forecasts by a smidgeon but the number was healthy overall. The housing recession remains on the table. Weekly mortgage applications this morning are disappointing.
Note Added 8:53 AM EST: Hello. Sondland prepares for his testimony and written text says he worked with Giuliani (Trump's lawyer) in Ukraine on orders from President Trump. S&P -10. Dow -85. Nazzy -33. Russell -7. VIX 13.15. The bulls are trying to jam volatility lower to offset any negativity from the Sondland comments. Oil +0.6%. Copper -0.3%. DAX -0.666%. 10-year yield 1.74%. The Housing Starts yesterday missed forecasts by a smidgeon but the number was healthy overall. The housing recession remains on the table. Weekly mortgage applications this morning are disappointing.
Note Added 9:44 AM EST: The trading day is underway and Sondland is making his opening statement before the House Intelligence Committee at the Impeachment Hearings. Sondland's comments thus far appear damaging to the president but the stock market is taking it in stride. The democrats and republicans may keep looking at the impeachment Rorschach image and see different things. The SPX is down 5 points, -0.2%, to 3115. LOD 3113.63. The Dow is down 64 points, -0.2%, to 27870. LOD 27860. The drama continues. Sondland continues singing his song. Copper -0.1%.
Note Added 11:05 AM EST: The Sondland testimony is damaging to the president. The proceedings take a 5-minute break and now the republicans will question the ambassador. Comically, the market does not care. The SPX is down a couple points at 3116. The Dow is off only 60 points at 27874.
Note Added 11:09 AM EST: Democrat Adam Schiff, who is conducting the impeachment show, runs to a microphone during the break time and emphasizes that Ambassador Sondland says the president is tangled up in a quid pro quo and all the top people were in on the nefarious game including Trump, Pence, Pompeo and others. The stock market still does not care. SPX 3116. Dow 27860. Nasdaq 8568. The Russell 2000 small caps are positive up 4 points, +0.2%, to 1602 maintaining the psychological 1.6K level. VIX 12.73. Copper -0.1%. King Donny is at the Whitehouse watching the Impeachment Hearings on television and laughing his orange head off. Like the bloviating showman said three years ago, his base and supporters love him so much that he could walk out onto 5th Avenue in New York City and shoot someone and no one would care. It looks like the market does not care about the Sondland testimony although perhaps global investors and traders, and the computers, are waiting to hear the republican line of questions to begin now.
Note Added 12:14 PM EST: The Sondland testimony continues. Markets continue yawning. The republican time ends and now the democrats are asking Sondland more questions. The stock market does not care about the impeachment proceedings, perhaps until it does. SPX 3114. VIX 12.84. Copper -0.2%. 10-year yield 1.76%. Gold 1468. Silver 17.06.
Note Added 1:23 PM EST: The stock market is falling apart on news that the US-China trade deal hits a snag. The SPX is down 26 points, -0.8%, to 3094. The Dow collapses 240 points, -0.9%, to 27694. COMPQ -1.0%. NDX -1.2%. RUT -0.8%. The VIX is 13.97 and was above 14 minutes ago. Copper -0.4%.
Note Added 3:38 PM EST: There is about 20 minutes remaining in the trading day with the SPX down 17 points, -0.5%, to 3103. LOD 3091. 20-day MA 3075. The Dow loses 148 points, -0.5%, to 27786. VIX 13.17. Copper -0.4%.
Note Added Thursday Morning, 11/21/19, at 5:15 AM EST: The SPX finishes hump day down 12 points, -0.4%, to 3108. The Dow loses 112 points, -0.4%, to 27821. The bulls fight back during the day yesterday since copper and commodities are holding in the bull camp as well as volatility. The Sondland testimony is damaging to President Trump but markets do not care. The Rorschach impeachment test continues with the democrats and republicans seeing things along party lines. Markets did react negatively to the news that the trade deal hits a snag. Overnight, however, the communist head negotiator Liu says he is "cautiously optimistic" so that brought S&P futures back from about -14 to -8 overnight. Copper -0.9%. As this message is typed, China's Liu now invites the US negotiating team to China for more talks. The bulls celebrate the trade deal hype like Pavlov's dog celebrates a biscuit and begin tripping over each other buying the long side. S&P futures are up +3. Dow futures +25. Nazzy +6. Russell +3. VIX 13.03. Teflon Don has appeared to weather the Sondland and impeachment storm, for now. Most Americans are likely resigned to the fact that all the politicians are corrupt. Copper -0.8%. Interesting. Copper does not yet recover like the futures do on the happy trade deal talk.
The Dow Jones Industrials Index (DJI; DJIA; INDU), the Dirty Thirty, the most-watched stock market index by the American public, prints a new all-time record high at 28090.21 on Tuesday, 11/19/19. The Dow's all-time closing high is 28036.22 on Monday, 11/18/19. Sound the Seven Trumpets! The American stock market is the S&P 500 and the SPX also prints a new all-time high at 3127.64 on Tuesday, 11/19/19. The SPX all-time closing high is 3122.03 on Monday 11/18/19.
Today is the big day. The Impeachment Hearings against President Trump continue in the House of Representatives in the US Congress. The drama is somewhat status-quo. The corrupt Democrat Tribe is tilting the scales every way possible to paint King Donny in a negative light and push the guy from office either before or in the November 2020 election now only 50 weeks away. The corrupt Republican Tribe continues to prohibit witnesses from testifying while at the same time proclaim transparent cooperation; they say there is nothing to see here except for the halo above Teflon Don's head.
Well, today, the rubber meets the road. One of the filthy corrupt tribes will win today and the other will lose and it will impact the stock market direction forward. Ambassador Gordon Sondland is testifying at the impeachment hearings and he has first-hand knowledge concerning the events in Ukraine. The president is accused of holding back military aid to Ukraine until the newly installed President Zelensky would announce in public that an investigation into Joe and Hunter Biden, and energy company Burisma Holdings, has started. Democrat Joe Biden is perceived as republican Trump's major foe in the upcoming presidential election (although his status is diminished during the scandal). Thus, King Donny was trying to get dirt on the Biden's and cause mischief in their campaign so his path to re-election was easier.
The democrats are just as filthy. Hunter Biden, who has no expertise in the energy arena, was placed on the Burisma board lining his pockets with hundreds of thousands of dollars. It helps that daddy has political clout and influence and was vice president at the time. It's easy to see why America's crony capitalism system is failing and is singing its final swan song during the coming months and few years.
The funniest aspect of all the impeachment drama is how it exposes the filthy rampant corruption among all politicians especially those within the beltway (Washington, DC). The final result of all the theatrics may damage both men. Biden may be viewed as corrupt with his son on the Ukraine energy board and his poll numbers are slip-sliding away. Trump may be viewed as corrupt as he uses taxpayer money to further his political and future monetary ambitions. This must be how crony capitalism finally implodes and ends. Capitalism fails because of human corruption and non-transparency just like all other ism's. It's not rocket science.
The plot thickens. Sondland donated millions to Donny's campaign and in return was awarded an ambassadorship to Ukraine (this is how the crony capitalism system works). Sondland likely regrets ever desiring such a position since his testimony, today, in only a few short hours from now, may determine the fate of the POTUS. It is amazing. Sondland will either sing a song like a canary spilling the beans on Teflon Don sealing the president's negative fate ahead for impeachment and the election, or, he may stick with Team Trump and perform Donny's dirty work defending the president. Sondland may support the president since if he gets into trouble over perjury or some other legal entanglement, and he goes to jail, he probably expects the president will pardon him.
The stock market idled sideways this week awaiting the outcome of the Sondland testimony which is imminent. If the Sondland testimony goes the way of the Democrat Tribe, Donny is toast. Republicans will begin jumping ship and drifting over to the impeachment side which would be the death nails of Trump's presidency.
If the Sondland testimony is not all that damaging for the president, and Gordy finesses his way through the hearing, the Republican Tribe will be throwing confetti and singing songs of joy. If Trump weathers this serious political storm today, his approval ratings will leap higher and he will pave an easy road to re-election next year. It's all on the line today. High drama. It is interesting that Sondland's testimony today will likely determine if Trump attains a second term, or not. Markets are watching and waiting.
S&P futures are down -11 and Dow futures are off -105 about 3-1/2 hours before the opening bell at 9:30 AM EST and less than 3 hours before the Sondland testimony. VIX 13.52. Gordy is set to testify at 9 AM EST before the House. The democrats want this story to be front and center all day long. This means that futures markets may be moving before the opening bell for the regular session. The tension and excitement mounts. Today may become messy.
The RSI and stochastics are overbot agreeable to a pullback. The red rising wedge patterns are ominous since the collapses from rising wedges can be quite dramatic. The red Ines for the chart indicators show all in negative divergence as price made the new high, thus, a spankdown is on tap. Remember, the uber low CPC and CPCE put/call ratios over the last couple weeks verify rampant complacency in the stock market and a significant top at hand.
The Aroon green line is at its max one hundo and nowhere to go but down which is bearish while the red line is at 28 coming up and out of oversold territory which is also bearish for the Dow. Watch the Aroon to see if the negative cross occurs which would forecast gloom ahead.
Price has violated the upper band so the middle band at 27463 is in play as well as the lower band at 26694. The Dow is extended above its moving averages requiring a mean reversion lower.
The brown circles show distribution taking place 10 times in the last couple months. That's the smart money handing off shares to the dumb money fools. Willie, that is popular with the ladies around the office, is bragging at the water cooler that he just bot AAPL and AMZN stock with his last paycheck. He cites all the record highs in stocks and tells everyone to buy equities right away or you will miss the train leaving the station.The smart money counts on the hype in the markets to allow time to distribute shares to Joe Fool, Jim Retail, Frank Sixpack, Bertha Bagholder and Sally Sucka.
Yesterday's candlestick is an outside reversal. Price made a higher high during the session but then closed at a lower low than the day before. This pattern points to negativity ahead. What typically happens is that price will sneak out a few more highs for a few days or week or two but on the weekly basis will begin a trend of downside going forward.
Stock market history may be written today. It all depends if Sondland sings like a songbird, or not. Of course any positive, or negative, trade news and/or central banker announcements will continue sending stocks to and fro. The Senate passes a bill supporting the Hong Kong protests which is causing dismay with the Beijing communist leadership and jeopardizes the US-China trade deal. The US House and president will need to approve the resolution in the days ahead. Okay, Gordy, it is all yours today. It is time for your 15 minutes of Andy Warhol fame; take it away. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
Note Added 6:45 AM EST: S&P -13. Dow -115. Nasdaq -44. Russell -11. VIX 13.62. Oil +0.4%. Copper +0.3%. Gold 1477. Silver 17.28.
Note Added 7:11 AM EST: S&P -7. Dow -74. Nasdaq -26. Russell -7. VIX 13.37. Oil +0.7%. Copper +0.2%. Gold 1473. Silver 17.21. DAX (Germany) -0.7%. US Yields are; 2-year 1.58%, 5-year 1.59%, 10-year 1.75%, 30-year 2.22%. The 2-10 spread is 16.4 bips.
Note Added 8:14 AM EST: S&P -9. Dow -87. Nazzy -30. Russell -7. VIX 13.42. Oil +0.6%. Copper slips negative over the last half hour down -0.1%. DAX -0.7%. US Yields are; 2-year 1.57%, 5-year 1.58%, 10-year 1.74%, 30-year 2.21%. The 2-10 spread is 16.8 bips. The Housing Starts yesterday missed forecasts by a smidgeon but the number was healthy overall. The housing recession remains on the table. Weekly mortgage applications this morning are disappointing.
Note Added 8:53 AM EST: Hello. Sondland prepares for his testimony and written text says he worked with Giuliani (Trump's lawyer) in Ukraine on orders from President Trump. S&P -10. Dow -85. Nazzy -33. Russell -7. VIX 13.15. The bulls are trying to jam volatility lower to offset any negativity from the Sondland comments. Oil +0.6%. Copper -0.3%. DAX -0.666%. 10-year yield 1.74%. The Housing Starts yesterday missed forecasts by a smidgeon but the number was healthy overall. The housing recession remains on the table. Weekly mortgage applications this morning are disappointing.
Note Added 9:44 AM EST: The trading day is underway and Sondland is making his opening statement before the House Intelligence Committee at the Impeachment Hearings. Sondland's comments thus far appear damaging to the president but the stock market is taking it in stride. The democrats and republicans may keep looking at the impeachment Rorschach image and see different things. The SPX is down 5 points, -0.2%, to 3115. LOD 3113.63. The Dow is down 64 points, -0.2%, to 27870. LOD 27860. The drama continues. Sondland continues singing his song. Copper -0.1%.
Note Added 11:05 AM EST: The Sondland testimony is damaging to the president. The proceedings take a 5-minute break and now the republicans will question the ambassador. Comically, the market does not care. The SPX is down a couple points at 3116. The Dow is off only 60 points at 27874.
Note Added 11:09 AM EST: Democrat Adam Schiff, who is conducting the impeachment show, runs to a microphone during the break time and emphasizes that Ambassador Sondland says the president is tangled up in a quid pro quo and all the top people were in on the nefarious game including Trump, Pence, Pompeo and others. The stock market still does not care. SPX 3116. Dow 27860. Nasdaq 8568. The Russell 2000 small caps are positive up 4 points, +0.2%, to 1602 maintaining the psychological 1.6K level. VIX 12.73. Copper -0.1%. King Donny is at the Whitehouse watching the Impeachment Hearings on television and laughing his orange head off. Like the bloviating showman said three years ago, his base and supporters love him so much that he could walk out onto 5th Avenue in New York City and shoot someone and no one would care. It looks like the market does not care about the Sondland testimony although perhaps global investors and traders, and the computers, are waiting to hear the republican line of questions to begin now.
Note Added 12:14 PM EST: The Sondland testimony continues. Markets continue yawning. The republican time ends and now the democrats are asking Sondland more questions. The stock market does not care about the impeachment proceedings, perhaps until it does. SPX 3114. VIX 12.84. Copper -0.2%. 10-year yield 1.76%. Gold 1468. Silver 17.06.
Note Added 1:23 PM EST: The stock market is falling apart on news that the US-China trade deal hits a snag. The SPX is down 26 points, -0.8%, to 3094. The Dow collapses 240 points, -0.9%, to 27694. COMPQ -1.0%. NDX -1.2%. RUT -0.8%. The VIX is 13.97 and was above 14 minutes ago. Copper -0.4%.
Note Added 3:38 PM EST: There is about 20 minutes remaining in the trading day with the SPX down 17 points, -0.5%, to 3103. LOD 3091. 20-day MA 3075. The Dow loses 148 points, -0.5%, to 27786. VIX 13.17. Copper -0.4%.
Note Added Thursday Morning, 11/21/19, at 5:15 AM EST: The SPX finishes hump day down 12 points, -0.4%, to 3108. The Dow loses 112 points, -0.4%, to 27821. The bulls fight back during the day yesterday since copper and commodities are holding in the bull camp as well as volatility. The Sondland testimony is damaging to President Trump but markets do not care. The Rorschach impeachment test continues with the democrats and republicans seeing things along party lines. Markets did react negatively to the news that the trade deal hits a snag. Overnight, however, the communist head negotiator Liu says he is "cautiously optimistic" so that brought S&P futures back from about -14 to -8 overnight. Copper -0.9%. As this message is typed, China's Liu now invites the US negotiating team to China for more talks. The bulls celebrate the trade deal hype like Pavlov's dog celebrates a biscuit and begin tripping over each other buying the long side. S&P futures are up +3. Dow futures +25. Nazzy +6. Russell +3. VIX 13.03. Teflon Don has appeared to weather the Sondland and impeachment storm, for now. Most Americans are likely resigned to the fact that all the politicians are corrupt. Copper -0.8%. Interesting. Copper does not yet recover like the futures do on the happy trade deal talk.
The SPX daily chart quickly set up negatively after the Friday upside orgy. The chart indicators on the S&P 500 daily chart are all in negative divergence. Conditions are overbot agreeable to a pullback. A nasty rising wedge is ready to create havoc. Price has tagged the upper band so the middle band and perhaps lower band are on tap. Price is extended above its moving averages needing a mean reversion lower. All these parameters are bearish calling for a top and look at that; the 2-hour chart above has all the same bearish behavior going on as the SPX daily chart.
You know a significant top is likely at hand because of the uber low put/call ratios telling you that market complacency is completely out of hand. Traders are drunk as skunks guzzling Fed champagne and BOJ sake and then getting sauced on PBOC rice wine this morning buying stocks with reckless abandon. One drunk, er trader, said, with slurred speech, "Juussst buy anythin' (spitum) everythin' goes up." Have another drink, buddy.
Since a market top is at hand, and the daily chart is in neggie d, it is good practice to look at the 2-hour chart to hone in on where the top is at and as described above, its here, its now.
The positive green cross for the Aroon occurred on 10/9/19, so about 5 weeks ago, and it has been nothing but wine and roses ever since. Watch for the negative Aroon cross in the days ahead (red circle).
Note the brown ascending wedge that played out when price kept bumping its head up against the 3K ceiling. The SPX eventually broke out higher so 50 points on that vertical side added to the 3100 targets 3150. However, that is cheesy price action in early November so the vertical side of the ascending triangle is more in that 11/6/19 time frame at about 35 points thus, 3135 would be the upside target for the triangle and the highest number ever printed in history by the S&P 500 occurs hours ago at 3124.17. The all-time closing high also occurs today, Monday, 11/18/19, at 3122.03.
The SPX is set to drop right now in this hourly and the daily time frame. The only thing that can save the day is happy US-China trade deal news or more dovishness from central banks. If these two things do not occur over the next day, the rising wedge may spank price significantly lower. The upper band is violated so the middle band at 3102 and lower band at 3077 are on the table for starters.
Price needs to come down and back test the 3100 level since it was key resistance for a long time before it became support. A failure out of the blue upward-sloping channel at 3105-ish would be bearish. That 3100-3105 area is key since it also where the middle band is at. Price may be drawn to here like a magnet. If this support area fails, then the lower band at 3077 is likely the next stop.
The bears will growl. Let's see what they got. Will it be a blood-thirsty gnashing and snarling of downside carnage or a baby whimper of only modest losses with anxious dip-buyers standing ready? This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
Note Added 7:32 PM EST: S&P futures are down -5. Dow futures -39. Nazzy futures -13. Copper -0.1%. 10-year yield 1.80%. Gold 1473. Silver 17.03. Hong Kong burns while Chinese Dictator Xi plays his fiddle. Japan and South Korean stock indexes are down from -0.4% to -0.9%.
Note Added 9:12 PM EST: S&P futures are dead flat. Dow +3. Nazzy +5. Copper +0.1%. Oil -0.3%. Gold 1470. Silver 17.01. 10-year yield 1.81%. Asian indexes are mixed on each side of the flat line. As Hong Kong burns, the Hang Seng Index rallies +0.8%. Hong Kong Executive Carrie Lam, the communist puppet that started the unrest that destroyed the city, is speaking, spewing more of her nonsense. Lam sold her soul for power and fame but now lives a daily nightmare. Investors are sniffing out a resolution to the Hong Kong drama. The mainland commie government will probably crush the uprising just like the Umbrella Revolution was crushed so speculators are nibbling on Hong Kong stocks sending the HSI higher. Lam is a talking idiot.
Note Added Tuesday Morning, 11/19/19, at 5:35 AM EST: East Coast traders rise from slumber to see S&P futures up +10. Dictator Xi took a page out of King Donny's playbook with China announcing overnight that the trade talks are going along swimmingly. Both leaders have a vested interest in keeping their stock markets elevated. Copper jumps higher so futures move higher. Copper gains +0.5% so each +0.1% pop in copper is creating a couple S&P points. The Keybot the Quant algorithm remains long the market but is currently champing at the bit to go short. If the SPX moves below 3112, Keybot will likely flip short. The stock market bulls need copper futures to rally +0.8% to prove that they can take the stock market higher. That is why they are goosing copper with happy trade talk trying to get the red metal, and futures and stock markets, to keep moving higher. If copper cannot rally the +0.8% today, and it rolls over to the downside, it will take the stock market with it. For now, as usual, the bulls are drinking Fed whiskey, ECB champagne, BOJ sake and PBOC rice wine astonished and amazed at their good fortune, feeling blessed that they are living in an age where stock markets run perpetually higher without any worry of downside. As Irving Fisher said in 1929, "We have reached what looks like a permanently high plateau." Nine days later the biggest crash in the history of the stock market began. Watch copper. Housing Starts drop within 3 hours. The Keybot the Quant algo identified the start of a housing recession on 7/17/19 and this is expected to continue. The Starts data is of super critical importance and would be expected to be weak to verify a recession trend ahead but the numbers will tell the story. The Monthly Jobs Report and Housing Starts are the two most important data points each month. Also, sentiment gauges such as the University of Michigan Sentiment and Consumer Confidence are very important. All the other economic data does not have as much an impact on broad stock market direction.
Note Added Tuesday Morning, 11/19/19, at 6:02 AM EST: S&P +9. Copper +0.5%. Oil -1.0%. VIX 12.27. 10-year yield 1.82%. Hello. HD beats on earnings but lays an egg with revenue and forward guidance. Home Depot is slapped in the face with a 2x4 (stick of lumber). HD crashes 18 points, -7.5%, to 220.90. Whoa, doggie. There were lots of bulls in that stock looking for perpetual upside. Money managers have Aunt Martha's and Uncle Johnny's money in HD telling them it is a guaranteed upside investment. Well, they lost -8% of their dough this morning. HD is a Dow Jones Industrial so the Dow futures take a tumble albeit still up +42. Use a 7 multiplier to gauge the impact of Home Depot on the Dow index. Thus, an 18 point haircut in HD will shave 126 points off the Dow. HD is jumping around in the pre-market now down 13 points so that would create about 90 points of downside in the Dow today.
Note Added Tuesday Morning, 11/19/19, at 6:47 AM EST: S&P +8. Dow +56. Nasdaq +37. Russell +6. Copper +0.5%. Oil -0.9%. Gold 1468. Silver 17.08. VIX 12.29. 10-year yield 1.81%. HD crashes 13 points, -5.4%, to 226.00 which will create about 90 negative points in the Dow Jones Industrials Index (DJI; DJIA; INDU) that is at all-time highs above 28K.
The search for the Godot Top over the last few days continues. The excessive market euphoria, joy, complacency and fearlessness, as evidenced by the low put/call ratios and volatility, want the stock market to receive a spankdown. The daily chart is now lined up for a top again; that did not take long. The mountaintop is a Rocky Top. Today, Monday, 11/18/19, the S&P 500 prints a new all-time record high at 3124.17 and a new all-time record closing high at 3122.03. Copper retreats -0.7%.
Price prints a higher high and the RSI is now flat, which is negative divergence (the chart indicator is diverging flat or downwards as price prints a new high indicating that price is out of gas). That sneaky MACD line is a hair higher over the last few days but remains in neggie d over the last 4 months. Thus, all chart indicators are back in full negative divergence so the top is in. The only thing that can save the day is more happy talk concerning the US-China trade deal and/or more dovish measures from any one of the 21 central banks currently implementing easy money policies around the world.
Note that none of the buying volume candlesticks over the last 2 months are stronger than the selling candlesticks on November 1st and 5th, thus, price likely wants to come down to explore that 3020-3080 area. At that time, bulls will need to come on strong with the volume to prove that the stock market still has longer term up legs. If the selling volume is strong on the way down, stocks are likely in for some long-term misery. Keep watching utilities. If they are dropping with the broad stock market then equities are in serious trouble for many months forward. If stocks drop but utes are flat or float higher, the dip-buyers will come into the stock market and equities will recover over the following weeks.
But, back to the present. Perhaps a Black Tuesday on tap? Will bulls keep the party going until Songbird Sondland testifies at the Impeachment Hearings on Wednesday? Markets may move tomorrow, Tuesday, ahead of the Sondland testimony since insiders will likely know information that is coming before the general public is informed or finds out on hump day. Such is the corrupt crony capitalism system. Adam Schiff, the democrat running the impeachment inquiry, will be beatin' on Gordon with a rubber hose while shining a bright lightbulb in his face forcing him to spill the beans on the Teflon Don.
It will be interesting to see if the stock market rolls over slowly or takes a drastically fast flush lower as per the ominous rising wedge pattern. It perhaps depends on hump day as Sondland, and probably the president, both tweet, only Sondland may tweet like a canary at the hearings and Donny may tweet like a Twitter twit from the Whitehouse. We live in interesting and historic times.
Keystone had a new harness installed on his computer chair, it crosses in front of the body at the chest area, and the new crash helmet arrived today from Amazon. The equipment arrives just in time for the festivities this week. Keystone is strapped-in and ready for the wild ride ahead. As Bette Davis said, "Fasten your seatbelts. It's going to be a bumpy night." This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
The band plays on. The bulls jam stocks higher on Friday, 11/15/19, the SPX printing a new all-time high and all-time closing high, both at 3120.46. Stocks closed at the highs last week. The Dow Jones Industrials are above 28K. The screen printers can barely keep up with printing hats for all the new ongoing records in the indexes. The bulls exclaim, "It's beautiful." The phase one trade deal hype and of course global central banker largess fuel the upside and maintain elevated equity prices the last few days.
At the same time, the CPC and CPCE put/calls are printing uber lows verifying rampant complacency and fearlessness in the stock market and a significant top at hand. Ditto the VIX which prints an 11-handle on Friday, down to 11.92, now trading very early Monday morning on the East Coast at 12.48. S&P futures are up +5 and volatility is higher so one of them is wrong since both are going in the same direction.
The rampant complacency calls for a 40 to 150-handle, or more, pullback in the SPX, however, much of this negative energy got burned up with all the happy trade talk last week and central banker promises to print money and support stock markets forever. Nonetheless, a large pullback remains on tap albeit from a higher price. On the weekend, the US and China both are touting happy trade talk which does not impress traders all that much; this silly nonsense is getting old. More central bank stimulus, this time from China,however, buoys global markets to begin the week.
The PBOC, China's central bank, lowers its key interbank lending rate. Of course they do. These central banks including the Fed, BOJ, ECB, etc..., are sick pups. One decade of stock gains are all based on phony financial engineering. It will be interesting to see it all collapse over the next couple years. Companies have repurchased mountains of stock over the last 10 years, since QE1 began in March 2009, and the earnings beats have everything to do with the amount of stock being reduced. In other words, the PE's that are at elevated levels right now should actually be increased another 30% or more across the board due to the stock buybacks (equities are highly overvalued despite everybody saying that stocks are fairly valued or undervalued). These are the types of things that analysts will look back on a few years from now and ask, "How come no one saw this?"
Keystone's proprietary trading algorithm, Keybot the Quant, remains long the stock market. The algo was in position to go short last week but the bulls keep pumping stocks higher so they remain in control. The quant is tracking copper and commodities as the two key parameters most greatly impacting broad stock market direction currently. Copper futures are up a smidgeon +0.1%. As copper goes, so goes the market.
The SPX daily chart was in full negative divergence last week ready to spank price lower. The only thing that can prevent this from happening is new news that the chart has not priced-in. Charts can only price in all knowledge known up to the minute. Thus, after the trade talk hype, where investors now expect an imminent US-China trade deal, the daily chart above will need a couple days to absorb this new news.
All indicators remain in neggie d (red lines) except for the RSI that pokes out higher. The RSI and stochastics are overbot agreeable to a pullback in price. The RSI, however, is long and strong now so price may take a jog move of a couple days (down-up) to allow the SPX to print a matching high and the RSI to go neggie d to lock in the downside projection again.
The red rising wedge pattern remains ominous since the collapses can be quite dramatic. Look at how price is extended above the moving average ribbon needing a mean reversion lower. The upper band was tapped a few days ago so the middle band, also the 20-day MA, at 3058, and rising, is on the table. Note the long period in June and July when price was above the 20-day; about 6 weeks. Price was only above the 20 about 3 weeks in September and now price has been above the 20-day about 6 weeks again further increasing the expectation that the SPX should relax downwards.
Investors and traders await the US-China trade deal news. It appears much of it is priced-in but you never know. Wharton economics professor Jeremy Siegel proclaims that the Dow will increase +10% when the trade deal is announced. The happy talk from Fed Chairman Powell last week also served to maintain an elevated stock market. Everyone and his brother, even cousin Larry that is a little bit slow after the accident in the barn, knows that the central banker easy money is the life blood of the stock market. The central bankers are the market.
So the drama and lookout for the top continues. As soon as the RSI goes neggie d, say in a couple days, the top will be in again. Watch the MACD line to see if it begins sloping higher; that will extend the top a couple more days. Bears want to see the MACD remain flat and the RSI to roll over lower. The pullback in stocks can of course occur at anytime if a negative news story hits the tape. For now, the US-China trade deal is in its final-final-double final stage and the PBOC just added more upside juice to the global central banker punch bowl, so investors and traders are singing songs and buying stocks.
Soybean Donny has a health scare this weekend. As usual, the Whitehouse will not release details but says it has nothing to with a sudden problem. Do you believe that? The Trump Administration spins a yarn that the president decided out of the blue to have part of his annual physical, which should not occur until February, performed now. Hopefully, the president's health is well. That early to mid-70's age window is where many heart attacks occur.
The Impeachment Hearings against President Trump continue. The two corrupt political parties, demopublicans and republocrats, flex their muscles and pose for the cameras. The Wednesday testimony of Ambassador Gordon Sondland is key. Sondland may sing like a song bird throwing his orange-headed boss under the bus, or, he may try to finesse his way through the hearing trying not to implicate King Donny. Sondland has to choose his words carefully; global traders, investors and algorithms will be hanging on his every word and sentence. Most humans choose to save their own skin when they are tangled up in a legal matter faced with a choice that potentially involves jail time. As the ole saying goes, 'there is no honor among thieves'.
The markets will be playing close attention on hump day since this is likely the pivot day for the impeachment process. After Sondland's testimony on Wednesday, the impeachment drama either gains steam and republicans start jumping aboard the bandwagon throwing the president under the bus crushing his hopes for re-election, or, the impeachment wagon breaks down, the wheels fall off, the bureaucracy is too bloated to continue with the impeachment, the democrats run for cover, and King Donny emerges as an invincible leader paving the way to re-election next November. We will know in a couple days.
The uber important Housing Starts hit tomorrow morning. The Keybot the Quant algorithm has identified the start of a housing recession on 7/17/19 so going on four months now. Typically, the main stream would be expected to catch-up with the call so tomorrow's data is key. Who knows? Maybe over the next two or three months the Starts may recover and point to happy days ahead, but, for now, the housing recession call remains in place and the numbers tomorrow morning are super critical. Housing and auto industries are the two main drivers of the economy. Copper futures are up +0.2%. The 10-year yield is 1.84%. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
Note Added 5:06 AM EST: S&P futures are up +5. Dow is up +66.60. Trip 6's. Nazzy +20. Russell +1. VIX 12.38. Futures and volatility are both higher so one of them is wrong. Copper is up +0.1%.
Note Added 6:27 AM EST: Russell futures slip negative a short time ago. Copper slips negative. S&P +4. VIX 12.44. 10-year yield 1.84%.
Note Added 6:55 AM EST: S&P +6. VIX 12.42. Copper is a hair positive. 10-year yield 1.84%.
Note Added 7:01 AM EST: S&P +5. VIX 12.46. Copper is a hair negative. Both WTIC and Brent oil are down -0.3%. Doctor Copper dances on the bull-bear tightrope performing flips and fancy balancing maneuvers, however, he is becoming whoozy from pills he's been taking in his desk drawer and is about to fall either into the bull or bear camp. Which will it be? As copper goes, so goes the market. Whoopsies daisies. Copper -0.1%.
Note Added 8:39 AM EST: S&P -4. VIX 12.95. Copper -0.5%. Soybean Donny needs to tweet about a trade deal if he wants to pump the futures higher. The VIX is sneaking towards 13 and the futures are negative so volatility was correct this morning and the futures wrong. 10-year yield 1.82%. Traders are taking a slight risk-off posture buying Treasuries. S&P futures lost 9 points over the last hour and one-half so something may be afoot in the background. Someone likely knows something. News wires are quiet. Perhaps rumors that President Trump may try to throw Secretary of State Pompeo under the bus for the Ukraine scandal create the sogginess in the tape. It is comical since eventually the orange-headed leader stabs everyone in the back around him and Pompeo, his closest confidant, may be next in line for the chopping block. The daily Whitehouse drama is a reality television soap opera.
Note Added 8:59 AM EST: China is rattlin' its saber creating the slight dip in futures. President Trump is not agreeable to rolling back tariffs so the communists are playing hardball threatening to hold off on a trade deal until after the election next year. Investors and traders remain happy and optimistic, looking forward to extra helpings of shaky puddin' during the holiday season. S&P -2. Dow +10. Nazzy -3. Russell -2. VIX 12.79. Oil is down -0.8%. Copper -0.2%. 10-year yield 1.82%.
Note Added 4:54 PM EST: Stocks are soggy during the day as copper stunk up the joint the red metal down -0.7% on the session. The bulls managed to push the SPX up 2 points to a new all-time record high at 3124.17 and new all-time closing high at 3122.03. Remember Keystone's 80/20 Rule that 8's usually lead to 2's, so 3118 hinted that 3122 was on tap and it occurs. That takes care of 8's and 2's unless 3128 prints which would hint that 3132 is coming. Also, the bulls are hoping the breach of 2800 will lead to 3200. Watching for this stock market to peak out, especially due to the low put.call ratios that signal uber complacency and a top at hand, is a hoot. Bring up the SPX daily chart. You can see that price prints a higher high and the RSI is flat, which is neggie d; that did not take long only 2 days to price-in the happy trade talk news. The MACD line is sneaking a tiny hair higher over the last few days, however, remains neggie d over the last 4 months. Thus, the SPX daily chart is back in full negative divergence after the Friday orgy. This price print may be the top, its overdue, if not, tomorrow the top will print, and if not, hump day will be the top. The stock market may try to hang on by its fingernails waiting to see if Ambassador Gordon Sondland sings like a songbird on Wednesday morning during the live televised Impeachment Hearings. Sondland's testimony may give King Donny a conniption. This is epic stock market history occurring in real-time.
The wheels fall off the CPCE collapsing to 0.47 a low not seen since the end of last year. The complacency has reached record levels. Frankie is already drunk as a skunk off Fed wine buying stocks without a care in the world. Timmy Trader throws darts at the stock pages to pick tickers since everything goes up forever with central banker largess and daily happy trade talk.
The S&P 500 prints a new all-time record high at 3110.21. The day is young. Traders are singing and dancing. The money is flowing like water.
The softness in stocks yesterday was due to the Senate putting together a bill addressing the Hong Kong situation. China says they do not want foreign intervention in the problem. Of course they don't; they are filthy communists. The Senate bill could jeopardize a trade deal. Stocks sold off. But fear not. America's faux free market crony capitalism system has cheerleaders and National Economic Adviser Larry Kudlow runs to a microphone proclaiming that the US-China trade deal is in its final stages. Stocks rally. Today it will be in the final final stage and next week will be the double-final final final stage. Soybean Donny said trade deals are easy two years ago.
The Impeachment Hearings against President Trump continue. The corrupt democrats build a case against the orange-headed bloviating carnival clown while shielding old man Biden. The corrupt republicans say there is no quid pro quo and Donny is completely innocent in fact look at the gold halo above his orange head.
The stock market is at a significant top that may prove epic. Traders and investors are afraid of missing out on the rally so they are buying and holding long positions while at the same time buying call options like maniacs. No one is buying puts since markets only go up. If any selloff occurs, the Fed and other central bankers will quickly come to the rescue so investors are no longer worried that stocks will ever sell off again.
You know what happens when traders are fearless. Yes, they are taught a lesson. Keystone continues to describe this topping process over the last few days. The low put/call ratios have yet to show their wrath, however, the sideways move in price at elevated record highs keeps burning off that available downside energy. The bears better get busy fast if they want to take advantage of the negative power of the put/calls.
The CPCE last printed this low at the end of December last year. Remember the big flush lower in stocks on Christmas Eve, then a recovery. The SPX peaked at 2515 on that low reading one year ago and dropped to 2445 in only a couple days; 70 quick handles. The stock market was toast on 1/3/19 and that is when the global central banker cabal stepped in to save the day and create this year's upside stock market glory. Perhaps this time the central bankers will not be able to save the day? At any rate, the 70-point downside should be matched at a minimum.
It is interesting that pundits continue parading across television screens saying markets are not at a top since there is no sign of euphoria as yet. They need to open their eyes. The CPCE verifies the euphoria and complacency with physical numbers. They are blind. Others say they are still looking for a blow-off top and since that is not in play, the stock market will continue higher for the months ahead. Look at charts! Some of the price moves are parabolic! There are gap-up days and gap-up weeks occurring left and right. This is a blow-off top.
A Bloomberg guest calls for SPX 3500 next year. On top of all this euphoric bullishness, folks close to retirement have over 70% of their money in stocks. Good luck to these souls. They will likely lose their shirts over the next couple years probably over one-half their wealth. Lastly, you know you are at a top when everyone tells you that there is no top in sight.
Same ole story the last few days since late last week. We are at a significant stock market top now. Perhaps the bears will growl today; stocks can begin the selloff at any time, any minute, any hour ahead. Perhaps a Black Monday is on tap? Get ready for a selloff if you have not already. If you have been contemplating selling your longs but remain on the fence, "Sell, Mortimer, Sell!" Ditch those stocks now and place shorts and buy puts. Today's goose higher on the happy trade talk may extend the top for a couple days to give times for charts to adjust. Humorously, if the trade deal falls apart this weekend, the charts will adjust very quickly.
The bulls have jammed stocks higher in the final half-hour of trading on the last two Friday's to paint a happy weekend tape. Also, the robots are buying big blocks starting 3:20 PM EST each day so it will be interesting to see if this occurs today. These are epic stock market times. If you are a young person, you do not realize this. Do not get caught up in the hype. Stay away from the stock market. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
Note Added 11:02 AM EST: The bulls are running. The SPX prints another new all-time record high at 3112.98; the 3113 palindrome. VIX drops to 12.33. The handful of remaining short-sellers in the market give up all hope and cover their positions creating a mini short-covering rally. All the bears have left town vowing never to return again.
Note Added 11:10 AM EST: Whoopie! Wheee! More new record highs for the S&P 500, Dow Industrials, Nasdaq Composite, Nazzy 100 and the SOX semiconductor index. The SPX prints 3114.56 the highest number in history.
Note Added 11:17 AM EST: The SPX prints 3114.56 a new all-time record high. VIX 12.35. Stocks print more euphoric new highs but the VIX is not moving any lower. The VIX lows today are at 12.31-12.35 so this level is key going forward. Note how the SPX nailed the 3114 breakout target of the sideways triangle on the SPX 2-hour chart. The happy trade deal news slightly delays the top.
Note Added 12:07 PM EST: The upside orgy continues with the SPX printing a new all-time record high at 3116.02. VIX is at 12.30 but did dip to 12.25 for the LOD.
Note Added 3:10 PM EST: The SPX prints a new all-time record high at 3117.11. VIX is at 12.14 dropping sub 12.30 so stocks receive another spurt higher. The bulls are running the show all day long. All Hail Larry Kudlow! Everyone, let's sing, "For he's a jolly good fellow......" Copper rallies +0.6% today creating market strength. The stock market rally is dubbed, "The Kudlow Rally." Will it result in the "Kudlow Top?"
Note Added 3:30 PM EST: At exactly 3:20 PM EST, the largest trading volume of the day on the one-minute basis prints. Interestingly, instead of more up, the strong volume spanks the SPX lower from the new all-time high at 3117 to the 3113 palindrome. VIX 12.20. No, check that, there is a 3112 print.
Note Added 3:49 PM EST: Wheeee. Here they come, three weeks in a row. The S&P 500 catapults higher from 3112 to 3116 in a heartbeat. Larry Kudlow says, "Happy Days Are Here Again."
Note Added 3:51 PM EST: The bulls want another record print jamming price higher. The SPX is at 3116.62 pennies from the record 3117.11 with minutes remaining in the day. Wow, look at that. Floor traders are carrying Larry Kudlow around on their shoulders singing, "For he's a jolly good fellow....." Whoa, price is at 3117.02. The bulls want that new record.
Note Added 3:54 PM EST: Spankdown. The SPX is slapped back, then a push higher. Bingo. The SPX prints a new all-time record high at 3117.60. A trader falls to his knees kissing a photograph of President Xi saying the communist leader is going to agree to a trade deal. Another trader drops to his knees kissing a photo of President Trump saying that King Donny will never let stocks go down again, ever. The confetti cannons are firing off shredded currency into the air. The band begins playing the Star Spangled Banner.
Note Added 3:58 PM EST: The SPX is going out at the record highs with price at 3118.61 a new all-time record high. It is a pure melt-up the same action now occurring three Friday's in a row.
Note Added 4:01 PM EST: The SPX finishes at 3120.46 a new all-time record closing high and 3120.46 a new all-time record high on Friday, 11/15/19. The SPX closes at the highs. Remember, Keystone's 80/20 Rule says 8's lead to 2's so the breach of 3080 opened the door to 3120 which just printed. A breach of 3118 leads to 3122 perhaps on tap for Monday. The bulls are salivating that 2800 may lead to 3200. It is amazing that price is only 80 points away from 3200. The final put/calls will be interesting today. Obviously, the market euphoria is out of control. Do you think the US and China will announce a final phase one trade deal this weekend? There are only 30 days remaining until the two sides can reach a deal (12/15/19). What do you think? Is a historic Black Monday on tap?
