The Mars Market Update — Live Research

Last week equity bears held the line at a key inflection point and reversed the prior week's gains to help set up more bearish potential. We remain bearish against these highs as we look for a wave (iii) or (c) decline as part of a larger degree equity market correction. Global equity markets and banks in general are warning of more downside risks from a big picture perspective. Bonds reversed sharply lower after its corrective decline while the US$ extended higher as expected. With CPI and...

Last week, equities rallied more strongly than expected to reclaim the 50 day sma across the board. Our expectation was for a wave (c) rally but the recent strength opens the door to more bullish potential. The question is whether this rally is sustainable given the headwinds of rising rates, higher crude and a stronger US$. The market leading Nasdaq rally is only in 3 waves up of equality so far, and the onus is on the bears to make a stand early this week to reverse last week's rally. We are...

Global equity markets rebounded last week into overhead resistance as bonds held key swing support. This remains our key indicator - will rates break higher in a convincing wave (5) rally or will they pull back to continue a more complex wave (4) correction? Higher rates will likely be a strong headwind for global equity markets. The US$ strength continued but is likely topping as economic indicators favour a relatively strong recovery versus the ROW. Take note of commodity currencies...

Last week, equities broke lower across the board as global rates continued to climb and pressure risk markets. The idea of higher rates for longer is putting pressure on long duration assets as investors continue to pare back positions given higher risk premia. The US$ strength continued into layered resistance as both industrial commodities and PM's remained under pressure. Global long rates are testing recent swing highs and are threatening to break out. Markets continue to anticipate more...

Equity markets continued to drift lower as rates rose and investors pared back risk in thin summer trading. The recent equity market decline appears corrective into initial support but we cannot discount the potential for a more bearish wave count. The US$ strength continued across the board as investors embraced the best house in a questionable street. Commodities continue to warn of a deteriorating global economic growth outlook as higher rates squeeze markets. Will higher rates break the...

Global equity markets declined last week for what we expect to be a 4th wave correction within an ongoing bull market trend. The building momentum divergence across the primary equity indices warned of a near term top that saw downside follow through last week. Rates pushed higher for a hard test of the primary swing highs before reversing lower after the weaker than expected NFP report on Friday. FX markets remain mixed and range bound as the global CB's chose different paths on this nascent...

Last week, equities continued to grind marginally higher as traders digested stronger growth, declining inflation and continued central bank rate rises. While the rally is extended and we are starting to see inter-market and momentum divergence there is no strong evidence of a tradable top. Bonds reversed sharply from resistance and sold off more than expected (especially the long end) while the US$ rallied following the strong US GDP data . We are starting to see a more divergent world as...

Last week, equities consolidated recent gains as investors began to rotate out of big tech and into the broader industrials. The DJIA is at a key inflection and has enough waves in place to potentially complete an "ending" diagonal or break up and out of its recent consolidation. The Russell 2000 is also testing the top end of its recent range for a bearish triangle consolidation. While there is no strong evidence of a tradable top, the equity market rally is extended and at risk of a 4th wave...

Last week's CPI came in not too hot, not too cold, but just right for this goldilocks market - the US$ broke sharply lower while equities, bonds and commodities rallied in the hope of a less interventionist Fed and potential soft landing. Equity markets are threatening to push towards new ATH's but small caps continue to lag the Nasdaq mega-caps as the growth outlook deteriorates. The DXY appears to be breaking down from its triangle wave B consolidation but needs to extend lower this week to...

Global equities continue to stall at resistance as global rates rallied across the board - the risk markets are attempting to price in higher rates for longer as global economies remain resilient with constrained labor markets. Equity markets appear to be forming a small degree wave (iv) correction within an ongoing impulsive rally. The alternative is a complex correction that is potentially complete for red W-X-Y (lower probability). The US$ and bonds (TLT) are threatening to break down from...