The Mars Market Update — Live Research

Last week, equities continued to stair step lower and finally broke layered support at Friday's close. Equities remain bearish while below Friday's highs with strong downside potential given this break of structural support. From a big picture perspective, we continue to see this rally up from the March 2020 lows as a final 5th wave of the impulsive rally from the March 2009 lows. The question is whether we have completed all of (5) or wave 3 of (5) as the Russell 2000 suggests. The US$ is...

Last week we saw a pullback in equities as expected confirming recent non-confirmation highs. Our primary indicator of market trend, the SPX / ES, has fallen back towards key trend support and the 50 day sma - it's make or break time (again). While the decline from ATH's is not clearly impulsive, the intraday series of lower lows and lower highs is warning of a potential waterfall decline if there is a sustained break of our key structural trend support. Remember, support is support until...

Equities continue to hold gains with no evidence of a tradable top. While the Nasdaq and SPX rallies are extended, the DJIA and Russell continue to underperform and require new ATH's to complete potential ending waves. The US$ fell sharply as expected with the USDSGD and USDCNH tagging downside targets. Bonds were unable to break higher and risk downside follow through. The DJIA / YM continues to follow the ending diagonal playbook and would look best with a final impulsive wave higher for...

Last week, the SPX and Nasdaq indices pushed to new ATH's as expected while the DJIA and Russell rebounded strongly from support. There are now enough waves in place to complete near term rallies in the former while the latter still need new ATH's to help confirm a longer term top. The US$ continued to decline sharply from resistance but so far the decline is in 3 waves and needs to extend lower in 5 waves to help confirm a bigger picture change in trend. The weaker US$ and Powell support...

Last week, the ES and NQ corrected lower into 50 day sma support before rallying to end the week. The Russell 2000 and DJIA held support and rallied late while the US$ pushed higher towards equality targets. Bonds consolidated gains after last week's rally. We continue to see the ES and NQ in topping patterns (no confirmation of a top yet) while the Russell requires a bigger picture 5th wave higher. Will we see a rotation back towards small cap growth? The US$ is approaching an important...

Last week, the grind higher in global equities continued with the SPX and Nasdaq indices leading the way while the small cap Russell continued to lag. The US$ remains range bound while bonds rebounded from equality targets. The PM's bounced from near term downside targets but remain range bound from a bigger picture perspective. The SPX / ES continued to grind higher as it wedges into new ATH's. We are looking for evidence of trend exhaustion as momentum indicators have NOT confirmed new ATH's...

Late last week saw a sharp reversal in the US$ and rates while global equities continue to climb a wall of worry. "If" rates rise from here and the reflation trades re-asserts itself, we should see a rotation from the Nasdaq indices towards the small caps (Russell). PM's fell sharply as suspected while industrial commodities remain mixed. The SPX / ES continues to trend higher as momentum indicators diverge. Whilst there is no evidence of trend exhaustion (higher highs and higher lows), "IF"...

Last week saw equity market bulls continue to press new ATH's but the trend appears to be exhausting. We still do not have clear evidence of a tradable top but momentum divergence is warning of an impending market reversal. The SPX and Nasdaq appear to be topping while the DJIA and Russell would look best with a strong wave 5 higher. Bonds failed to confirm a bearish reversal and remain well bid as markets embrace the slowing growth narrative. Bitcoin tagged initial wave (c) targets from where...

Last week, equities rebounded strongly from our key support and pushed to marginal new ATH's. The bullish trend of higher highs and higher lows remains unbroken and despite deteriorating momentum, there is no evidence of trend exhaustion. With the FOMC due on Wednesday, markets are counting on a more dovish outlook to help prop up this liquidity fuelled rally - any disappointment will likely see a sharp bearish reversal. The Nasdaq and SPX pushed to new ATH's but the rally has not been...

Last week saw a continuation of the recent reflation trade unwind with commodity currencies weakening, bonds rallying, curve flattening and the small caps rolling over (again). We warned last week that the Russell 2000 only showed 3 waves up of equality, leaving it vulnerable to another extension lower if bulls couldn't make a stand. This is an important week for the reflation trade as we look for a turn in the US$, bonds and Russell. This week, we are keeping a close eye on AUD, CAD, NOK and...