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What Jackson Hole Means for the Stocks and the EconomyStocks swiftly sold off as the markets digested comments from the Jackson Hole retreat. This is a gathering of central bankers from around the world, and while no 'official' policy decisions are made, the markets pay great attention to comments made by key members. In particular, Jerome Powell came off sufficiently more Hawkish than anticipated , and the markets reacted as such. The dollar soared past highs along with bond yields and stocks tanked. Powell even said that Americans should expect 'pain' which was a particular somber note and drove the selloff further. At this point a 75bps or even a 100bps rate hike are not off the table for September. Also, particular mention was given to how rate hikes may impact the labor market, with some sources suggesting it could cost up to 4 million jobs . The S&P 500 tumbled to the base of the 4K handle at our very last level at 4009, a level we have been identifying for weeks. If this level breaks, we will return to the 3K's again, with 3978 and 3963 the next levels of support.
FX:SPX500Short
by quantguy
1
Final crash is coming !We have so many confluences on this set up : 1) We can see a rejection of the higher band in the descending channel. 2) Another rejection of the 618 from the past impulsion. 3) Friday the Jackson Hole summit of the Fed provides us negative news fundamentally, Hikes IR -> investors will change their positions from equities to Bonds or most simply Banks. And even more investors will buy USD (wait and see $€). 4) Technically, the bearish divergence on RSI is not a good signal to buy. 5) Even tough, the price still have power to reach the final target. 6) We have a daily Head&Shoulder. 7) Moreover, seasonality is with us, because over the last decades, usually September has been a negative month. To sum up, we have at least 7 confluences and fundamentals are clearly bearish with a hawkish monetary policy from the Fed. Let's look for an entry point now !
CME_MINI:NQ1!Short
by Aksel_trader
SPY turned... hard down!What an eventful week! Well, at least a very eventful Friday! By now, most of us would have read about Fed Chair Powell's comments at the Jackson Hole Symposium. The markets did not take lightly to the stated prudence. Technically, we can see from last couple of week's analysis that the bull rally with old in the teeth, and that last week's SPY chart was a potential reversal, with a likely breakdown, and earlier breakout failure. The dramatic way it occurred tells much of the underlying sentiment. The weekly SPY chart clearly started the week badly with a gap down, following a bearish candlestick pattern last week. Then this bad start to the week worsened a lot more on Friday, with a massive downdraft that had the week clock a bearish marubozu styled candlestick. Bearish with some momentum. The SPY Daily chart made the bearish stance a lot clearer with the massive bearish marubozu on Friday that basically failed support and critically the 55EMA. Technical indicators all crossed under the zero line, supporting the bearish alignment. The breaking of both weekly and daily 55EMA on the same day, with a similar bearish marubozu candlestick is a very clear bearish indicator with momentum that calls for more downside. It is expected that there would likely be a technical bounce, so watch for the bearish turnaround to follow through the price action momentum downwards. Based on volume analysis (not shown here), a likely support range lies between 370-380. Similar to the NASDAQ analysis, there is a possibility for further downside, but not apparent at the moment; so tentative expectation of a higher low is still reasonable.
AMEX:SPYShort
by Auguraltrader
What Jackson Hole Could Mean for StocksStocks pivoted from 4122, where we saw strong support from green triangles on the KRI. Subsequently, we were able to pivot and made a run for higher levels. We have broken past 4188, the exact level we called out as a target yesterday. The Kovach OBV has picked up, but we will likely not see too much action until the Fed's Jerome Powell speaks at the Jackson Hole retreat at 10AM EST. If he sounds dovish, it could be an indication that the Fed's aggressive monetary policy is softening, and we could see a nice rally. If not, 4122 should continue to provide support. After that we have a vacuum zone to 4068 then 4009.
FX:SPX500Long
by quantguy
Stocks Hold Critical LevelsThe S&P 500 has faced a relentless selloff, with Fed expectations, troubles in Europe, and high inflation continuing to impact the economy. We have broken through all support levels in the 4100's, except for 4122, the last level before the vacuum zone below. After that, there is a vacuum zone to 4068, then 4009. The Kovach OBV does seem to have picked up a bit despite the fact that we appear to be hanging on to 4122 by a thread. If we can muster a pivot, then 4188 is a likely target.
FX:SPX500Short
by quantguy
Can Stocks Hold the $4100's?Stocks have continued to tumble, testing lower levels in the 4100's. We have plummeted past 4188, and are testing 4122 at the time of this writing, which is the last level in the 4100's. If this does not hold, there is a vacuum zone below to 4068, then 4009. Support seems to be holding for now, confirmed by green triangles on the KRI. The Kovach OBV seems to have leveled off from its bearish decline, so we may see a pivot off support. If so, 4188 is a reasonable target.
FX:SPX500Short
by quantguy
Forget All Other ChartsIgnore all the other charts right now. They are based on DOLLARS. The dollar is permanently unstable and your imperialist overlords are here to take away your spending power. We're due to see bearish action similar to April 5th (pink dot). The question is, will we see a lower high in relative yields, or will we set a higher low and possibly become uninverted, and return above 1.0 once again? Consider that we just set a higher high in the S&P medium term and it could have simply been a move to fool the crowd. On the other hand, debt is at all time highs, and rates even at this level mean systemic insolvency. Raising rates further means quicker insolvency. I say just get it over with or don't do it at all. Inflation year over year is, realistically, 20-40%, each year since 2020. Key interest rates aren't even 10% of that. There is no way they will be able to control this in any way, shape or form, or manufacture a so called "soft landing". Rates rise >1.0 = total collapse, then easing Rates bounce <1.0 = unrealistic rally blow off top, more tightening to trigger the crash I think I used too many arrows but hopefully it makes sense. Good luck and don't forget to hedge your bets.
TVC:US10Y
by fringe_chartist
11
What Factors Will Weigh on Stocks This Week?Stocks have opened in the Asian session in the red, as the European energy crisis and hawkish Fed expectations weigh on the markets. Additionally, we have several stocks cutting dividends and also several downgrades. We are currently just below 4188, where we anticipated support. We are just above 4178, the next level down, at the time of this writing. If things continue to go south, then we should have further support deeper in the 4100's, 4122 in particular. If we can muster the strength for a rally, then 4214 is the next target.
FX:SPX500Short
by quantguy
S&P Still Primed to Continue HigherCOT data is signaling a great buy opportunity in CME_MINI:ES1! despite all the talks of this "bear rally" peaking and a coming recession The COT data has had us in this trade for the last couple months - just 1 SPY Call profited over $2,000. Personally, I took profits last week in accordance to my trading system. However, with the COT data still pointing heavily long, I'm looking for the daily chart to signal a long entry this week Notes on My Trading Methodology and What I'm Even Talking About COT Definitions: - COT: Commitments of Traders Reports - A weekly report published by the government (CFTC) that shows long and short positions of the below 3 groups (As well as much more data I don't look at). We look at the NET positions of these 3 groups and compare them to historical levels to signal trade opportunities 1- Commercials: Hedgers - We want to trade with them when they're at extreme levels (Think Tyson for meats, Cargill and General Mills for grains, etc) 2- Large Speculators: Hedge funds and large institutions - We want to fade them (trade against) when they are at max positions (Think suits in NYC and commodity funds) 3- Small Speculators: People/institutions trading small lot sizes not big enough to report to CFTC - We want to fade their max positions as well since they represent the public (Think dude in his PJs trading and small trading firms) Indicators on Chart: - The first indicator shows the net positions of the 3 groups above plotted over time - The second indicator is an index of the relative buying/selling of commercials over a certain lookback period. Anything above 95 is looking for buy (Green shading), look to sell when it hits 0 (red shading) - I use both a short-term and long-term lookback - When the small speculators are at max positions as well, it's further proof to get in the trade (shading gets darker) - Note: Just because the Commercial's net position is negative doesn't mean it can't be relatively net long and signal a buy (same in the opposite scenario). This is very common with Gold for example Trade Setup - Both Must Happen: - When commercials are at max levels we are alerted to buy or sell (Depending on the criteria above) - On a daily chart, use technical indicators, candlestick patterns, news, etc to enter the trade (I have a proprietary reversal signal I use) - Added bonus when the trend is your friend (I use a Multiple Moving Averages indicator to visualize) - If the trend is against you on both a Weekly and Daily chart, the short and long term Index must both be signaling to trade. If the trade fails, look to reverse the position and go with the trend
CME_MINI:ES1!Long
by Rudeadam18
DXY vs S&PLet's look at the DXY vs S&P, which illustrates some of the recent market moves pretty well. Lately, the DXY and S&P have been inversely correlated. In other words, when the DXY moves up the S&P moves down, and vice versa, when the DXY moves down the S&P moves up. The 100 day trend of inverse correlation is starting to wane and both price trends have decayed from ultra bearish back to random, as illustrated by the RWI signal showing a converging uptrend and downtrend line. Historically, this environment is a bullish signal for the market. My outlook changed from extreme bearish to neutral as this played out, and I think this chart helps illustrate why. Both price trends were fairly decisive since the downtrend from October 2021 began: every time the DXY set higher highs, the S&P set lower lows (yellow dots). But now, the symmetry of the bearish impulse has faded and weakness was shown (blue dot), and the prices returned to randomness. Unless the RWI signal can break out of the "peak bearish line" in the chart, we should expect the random trend to continue and the bearish trend to fade, for now. Take a look at the "peak bearish line". Lately, every time the RWI uptrend signal (the green trend) meets the "peak bearish line" (straight red line). Yesterday was a good example, we hit the line, then bounced off today. Chances are, you felt pretty bearish all of a sudden yesterday, based on the market action, because I sure did! I made sure not to overreact, because we did not breakout of this resistance. I expect these symbols to become uncorrelated soon. DXY is practically touching all time resistance on a 50 year channel. However, if or when the DXY continues to break out with force above 108, we should expect more bearish action in equities. If it doesn't, I expect a lot of chop in the DXY and a rather bullish S&P until the price cannot sustain itself, possibly similar to a 1999-2000 type scenario, if we haven't already seen it. The current sentiment in the equities markets seem to express that we have already seen all time highs, for now. If that was the case, I would've expected this S&P rally in the past few weeks to be a bit more subdued. Overall, I'm not sure if we actually have, and it would be foolish to trade on the assumption that we have 100% seen the top. With that said, I would expect even more bullish S&P action, possibly with some chop mixed in (see S&P in September 2020), with lots of DXY chop. Obviously, you should only allocate risk according to your personal plan. I think much of the market is afraid to go along with *any* plan at the moment, and personally, as traders, we must divide our risk equally here and be sure to not be 100% bearish until the dragon comes out to play again. Consider how many shorts are being closed at a loss and how many frustrated traders will open longs for vengeance. I'm not trying to suggest a trade here but I do hope this gives some rationale on the latest price action. What do you think? Thanks for taking a look, and I hope you enjoyed the idea. Don't forget to hedge your bets! - your fringe chartist
TVC:DXY
by fringe_chartist
1
Stocks Facing ResistanceStocks have steadily drifted down from highs at 4327. Retail sales data on Wednesday confirmed the impact that high inflation is having on the economy, and investors are fearing another 75bps rate hike in September. We are seeing a lot of resistance at current levels confirmed by red triangles on the KRI. However, we are also seeing support at 4245, at least for now. If we fall further, then 4188 should be considered a floor for now. We must break out past 4327 to solidify higher levels, which likely won't happen until next week at the earliest.
FX:SPX500Short
by quantguy
Retail Sales Dampen StocksStocks have slipped a bit from their week-long rally. Retail sales data confirmed the impact inflation is having on consumers, justifying the current Fed interest rate trajectory. The probability of another 75bps rate hike is above 50%. A retracement from highs was due, as higher highs were increasingly more labored. We gave up the 4300's, after making it as high as 4327. We then retraced the mid 4200's, currently just above our support level at 4245. If we retrace further, 4188 should surely provide support. The Kovach OBV appears to have topped off. Watch the open to see if more momentum comes through today.
FX:SPX500
by quantguy
How Will Retail Sales Effect Stocks Today?Stocks have pushed higher, spiking up to our level at 4327. However, we have retraced back to the high 4200 handle. The rally appears to be growing weaker. We have some risk off news including Tencent, the Chinese tech firm reporting negative revenue for the first time in history. We also have retail sales at 8:30AM EST, which another data point the Fed will be looking at. A softer reading will weaken the Fed's case to aggressively hike rates, though the headline is only expected at 0.1% . If we do retrace, then 4272 is a reasonable level to expect support, with 4188 a likely floor. If we break out, then 4350 is the next target.
FX:SPX500
by quantguy
Can Stocks Break 4300?Stocks keep edging higher, breaking new relative highs albeit gradually. We broked from 4272 to 4293. The difference between daily highs is decreasing, suggesting a retracmenet could be near. If so, 4214, or 4188 are good candidates for support. If we are able to rally again today, then 4306 is the next target. This would also be the first technical level in the 4300 handle. The market rally seems to be hinging on expectations of a more dovish Fed outlook, especially after the 50bps rate hike expected in September. Housing and retail sales data will help provide a clearer picture this week.
FX:SPX500Long
by quantguy
1
Stocks Open Near HighsStocks opened near highs as investors digest last week's data. We have retail sales and housing data this week, which may contribute to a clearer picture of the Fed's plan for their September meeting. Currently, the estimate seems to be a 50bps rate hike, followed by a potential softening in policy stance. The S&P 500 hit our target of 4272, and seems to be tapering slightly. The Kovach OBV is strong, but has started to level off. If we see resistance here, watch for support in the lower 4200's or 4188. If we are able to break out again, then 4306 is the next target.
FX:SPX500Long
by quantguy
Softer Fed Outlook Fuels Stock RallyStocks have rallied, breaking through to higher levels. The markets seem to interpret recent economic data in a manner that suggests that the Fed is going to cool down their hawkish stance. Right now, a 50bps rate hike is expected for September (potentially the last one), whereas 75bps was not off the table before Wednesday's CPI. This was further supported by Producer Prices. Markets are considering this a green light to rally again. We have broken past 4245, but have fallen just short of our target of 4272. Resistance is confirmed by red triangles on the KRI. The Kovach OBV has picked up with the rally, but it does appear that momentum is stalling. We are due for a bit of a retracement, with 4188 a reasonable area to expect support. If the rally can continue then 4272 is the next target with 4293 and 4306 in line after that.
FX:SPX500Long
by quantguy
Forecast is for rain (market top)Chart shows SPY (2D) and the percentage of stocks above their 20DMA(aqua) and 200DMA (yellow). Each series is the mean percentage of 7 index's which, in turn, aggregate several thousand underlying stocks. The 7 indexes: S&P, Dow, Nasdaq, Russell, TSX, NYSE, AMEX The peaks of the index coincide with market tops (as shown in the chart). Based on this pattern it's reasonable to forecast a top. Like the weather forecast, the timing is uncertain, the underlying averages lag, and their are plenty of false positives**. Current forecast is for rain. ** Why do we listen to a weather forecast that we know is somewhat inaccurate? Because it's useful in answering questions like: "should i take an umbrella with me today?" ** All models (and indicators) are meant as useful approximations of reality.
AMEX:SPY
by gb50k
2