The Mars Market Update — Live Research

Last week, equities faded from resistance but the decline is NOT YET clearly impulsive. We do not have confirmation of a tradable top in equities and despite last week's decline, the potential remains for a continued push higher. The equity market seems to be awaiting this week's CPI before committing to a near term direction. We remain bearish from a big picture perspective but remain patient as this counter-trend rally fades. Meanwhile the US$ and rates continued to rise in line with...

Equities rallied last week as global central banks stepped back from their hawkish signalling. Many equity indices have met minimum upside targets for this proposed wave C rally but despite Friday's weakness there is no strong evidence yet of a bearish reversal. The US$ rallied late last week to form a bullish weekly reversal. Bonds fell sharply from 200 day sma resistance following Friday's strong NFP to set up a more complex correction. Commodities fell across the board, signalling weaker...

Last week, equities extended their recent rallies and broke out from bearish trend channels and triangles (forewarned is forearmed). Bears are on the defensive as markets look to squeeze higher this week in front of key rate meetings by the FOMC, ECB and BOE. Bulls are leading the narrative with the idea of a goldilocks recovery but we continue to see this rally as part of a larger degree correction within a bigger picture bear market decline. The recent equity market price action (unable to...

Last week, equities turned sharply lower from resistance but were unable to sustain any break of near term support. The October lows remain intact. Friday's strong opex rally has called into question the bear case. The structure of equity indices, especially the Nasdaq and SPX, are starting to resemble a triangle compression, increasing the risk of an upside breakout. While the big picture structure remains bearish, there is a risk of a near term break-out rally if bears don't immediately...

Last week, risk assets rallied across the board as traders absorbed high but receding inflation and a weakening global economy. The market is front-running the goldilocks recovery and elusive soft landing. Hopium remains firmly entrenched. We are looking for a bearish reversal early this week to maintain our bearish outlook. Equity Markets - decision time Equities rallied strongly to tag upside targets highlighted in last week's update and now it's decision time... Bears need to make a stand...

Last week, equities traded sideways before a late week rally as risk markets digested the latest NFP report. The markets reacted positively to the data as the US$ declined while bonds and equities rallied (risk-on). This week will be important to see if there is any risk appetite to follow through. The near term bear count is invalidated above the wave 2 December highs. This week's CPI report will likely be critical for ongoing market sentiment... Equity Markets - setup pitch Our benchmark SPX...

From our previous update, "The decline from last week’s highs appears impulsive but would look best with a small degree iv and v to complete an impulsive wave (a) or (i) down". Global equity indices show an impulsive 5 waves down from recent swing highs across the board to set up the next bear market trend. Early this week should see a counter-trend rally for wave (b) or (ii) as we look for (c) or (iii) down into next week. The US$ is still searching for a low to complete wave A or 1 down...

Last week, equities pushed to marginal new highs before reversing sharply lower for an outside-week bear reversal. "It is the reaction to the news that matters". The complication is that the near term SPX / ES rally up off the October lows can be counted as both bullish (impulsive) and bearish (corrective). At these times it is best to stand back and focus on the bigger picture trend which remains bearish. The US$ and rates are attempting to hammer out a tradable low while the commodity...

Last week equities turned lower from our sell zone but the decline is not yet clearly impulsive. Bears need to see downside follow through this week and press lower to break near term support to help ensure an impulsive bearish reversal. Trade above last week's highs invalidates the bear case and opens the door to more bullish options. The US$ and rates appear to be bottoming and are likely setting up a near term counter-trend rally. Crude Oil broke lower as expected as we look for an end to...

Equities continue to climb the wall of worry since the October lows as markets bet on a less hawkish Fed going into year-end. Buoyed by declining rates and a weaker US$, equity bulls continue to press higher into layered resistance. While there are enough waves in place to complete this counter-trend rally, there is NO confirmation of a tradable top. We are awaiting evidence of a bearish reversal to confirm a tradable top. Equity Markets - looking for a turn (still) The SPX / ES continues to...