The Mars Market Update — Live Research

Friday saw a spike in volatility as markets feared rising geopolitical risks in the Ukraine. Crude and Gold spiked higher while equities sold off... Macro tailwinds have turned into headwinds for equity markets, making this a very difficult trading environment - risks abound. Equity market volatility continued last week as bulls and bears continue to fight it out in the face of rising rates and geopoltiical risks. The SPX, Nasdaq and Russell all failed their respective retests of key...

Global equity markets remain within 4th wave corrections. This choppy price action is illustrative of the bulls and bears fighting it out at the end of a trend - we need to keep perspective on where we are in the bigger picture trend - an ending wave. While macro tailwinds (reflation) become headwinds (stagflation) for the equity markets, hope springs eternal as traders try to ride this bull until the end. DJIA QTR Equity Markets: Likely 4th wave and no impulsive decline So far, our benchmark...

Equities broke lower early last week to tag our measured targets and test our bigger picture support zone. Our base case for the SPX / ES remains unchanged - that is, this latest decline is expected to be a wave 4 correction prior to a final wave 5 of (5) to new ATH's. While our preference is to see another early sell-off this week to marginal new lows to complete wave (v) of (c) of 4, it is not required. Given that our downside targets have been met, we should allow for the possibility that...

Equity markets broke lower across the board last week as warned. Importantly, the primary equity indices tagged initial downside targets for a "corrective" decline. However, if our primary count of an expanded flat (3-3-5) is correct, this latest decline should extend lower into 5 waves for red wave (c). While we are open to more bearish outcomes, our analysis is based on the irregular (incomplete) 3 wave tops formed in the SPX and DJIA. In the meantime, these are nasty trend breaks... This is...

Equity markets continue to hold long term trend support as shown in the charts below but the internal wave structures warn of significant downside risks if last week's lows break! So far, the Nasdaq and SPX have declined in a corrective 3 waves of equality from recent ATH's into last week's lows - a break of these lows opens the door to a much larger decline. Caveat emptor! The SPX / ES continues to hold trend support after 3 waves down of equality but last week's rally is at risk of failure....

Last week we warned about the potential for a wave (b) top and sharp reversal in equities. Equity markets did reverse impulsively lower and potentially sets the stage for a larger red wave (c) decline. Rising Rates continued to provide headwinds for long duration assets. Despite the risk-off environment, Crude Oil and RBOB continued to rally. The Nasdaq / NQ (bellweather) is approaching major support. So far, the decline is only in 3 waves of equality testing fib and long term trend channel...

Wishing everyone a safe and prosperous 2022! Over the next few weeks, I will be formulating our "Year ahead" big picture outlook for 2022 - stay tuned... Global markets rallied into year end as expected as the primary bull market remains intact. The SPX / ES, our primary risk indicator, closed the year at new ATH's as wave 5 of (5) progresses into the new year. So far, we only have 3 waves up of equality from the December lows. The question is whether the rally is in the middle of an...

Wishing everyone a happy holiday season and all the best for the new year. Given the holidays next weekend, our next MCP Market Update will be posted in the new year 🙂 Markets whipsawed last week as they failed to break-out to new ATH's despite the bullish Santa rally setup. The US$ remained well bid and bonds traded sideways. Industrial commodities continue to lag as global growth slows and CB's tighten policy. The SPX / ES rejected ATH's late in the week but no real damage has been done to...

From last week's update... "Prima facie, the trend still appears bullish with impulsive rallies and corrective declines but two-way risks are significant given where we are in the cycle." - the bears fumbled and the bulls ran. The door is open for a santa rally into year-end if the bulls can sustain a breakout here. Market leaders continue to lead and look bullish while small caps are warning of downside risks. Mixed markets continue with two-way risks. Tread lighly (protect capital) as this...

Last week, global equities continued to decline as expected BUT the structure of the decline for the major indices remains mixed. While the decline from ATH's in the DJIA and Russell 2000 appear impulsive, the decline in the SPX and Nasdaq is more overlapping and less clear. Rates, flattening yield curves, industrial commodities and commodity currencies are all warning of a slowing global economy and less CB intervention. Extreme bullish sentiment is concerning as the herd continues to buy the...