PACW, JPM and ES
S&P 500 with yields gyrated wildly on celebrating CPI and ignoring sticky core CPI yesterday, and the buyers won in the end as my four conditions weren’t met, yet market breadth watchers can‘t speak about confirmations really.
Well before the weak bullish momentum from yesterday petered out, I called for the bears to start moving, and they did. BoE rate hike – even if expected, illustrated the universal problem of a not disinflating fast enough core inflation.
Let‘s bring up my Monday‘s macroeconomic predictions for today:
(…) Thursday‘s PPI would probably underwhelm, and come only a bit above zero, and the core PPI as well. Unemployment claims at 250K seem as a correct expectation
PPI came in line with my expectations while unemployment data were of a more recessionary flavor – and that‘s positive for the sellers. Keeping the big picture in mind, this is still the calm period even if we break below 4,115 soon. Hello PACW – the daily outlook is sure bearish.
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Let‘s move right into the charts (all courtesy of www.stockcharts.com) – today’s full scale article contain 6 of them.
S&P 500 and Nasdaq Outlook
See that miserable „improvement“ in market breadth? Each time the buyers come back and win the day, they end up weaker. Talk of a Pyrrhic victory.As I‘ve been always saying, markets are most vulnerable at their narrowest, and that‘s where they are now. The rubber band is very stretched, and would snap back in the opposite (that‘s bearish) direction.
While I had been often talking tech since Dec as one of the best sectors to be in, I had been highlighting value and Russell 2000 weakness – the degree of underperformance is obvious.
4,150 is merely a first step – 4,136 followed by 4,128 – that‘s the true objective for today. Any time of the bears‘ choosing (properly said, strength on a strong catalyst such as banking fears), it‘s 4,115 and then 4,078 breaks that usher in increasing acceleration.
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All essays, research and information represent analyses and opinions of Monica Kingsley that are based on available and latest data. Despite careful research and best efforts, it may prove wrong and be subject to change with or without notice. Monica Kingsley does not guarantee the accuracy or thoroughness of the data or information reported. Her content serves educational purposes and should not be relied upon as advice or construed as providing recommendations of any kind. Futures, stocks and options are financial instruments not suitable for every investor. Please be advised that you invest at your own risk. Monica Kingsley is not a Registered Securities Advisor. By reading her writings, you agree that she will not be held responsible or liable for any decisions you make. Investing, trading and speculating in financial markets may involve high risk of loss. Monica Kingsley may have a short or long position in any securities, including those mentioned in her writings, and may make additional purchases and/or sales of those securities without notice.
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