The Mars Market Update — Live Research

US equity indices pushed to new ATH's after the corrective decline as tweeted last week. With markets at key broadening formation resistance and earnings season now on deck, we are awaiting evidence of a bearish reversal as I don't like the risk/reward of chasing longs here. Long bonds continued to decline into our downside target area with no evidence yet of a tradable low. The USDJPY reversed lower from key 109 resistance while Gold continues to hold our 1380-85 key trend support. Inflection...

Last week, equities pushed higher into our resistance zone as expected. We are approaching a key inflection point for risk assets. Powell's testimony and CPI likely key sentiment drivers this week. While there are enough waves in place to complete this near term rally, there is little evidence of a bearish reversal. My preferred case remains a failed breakout here. Bonds reversed sharply lower after completing its 5th wave triangle thrust while the DXY extended its rally into an impulsive 5...

Risk markets gapped higher today following Trump's Huawei concession as he kicks the trade war can down the road. The problem is that the conflict is NOT resolved and the global economy continues to slow. We find it difficult to be overtly bullish risk assets with this backdrop as we are one bad Trump Tweet away from risk reversal. The ES made new cycle highs following the G20 meeting but we still think this is an ending wave. The unbroken sequence of higher highs and higher lows throughout...

Last week, equity bulls extended gains as expected and we are now testing ATH's and layered resistance. The US dollar reversed lower while Gold broke up and out of a multi-year triangle. Bonds made marginal new highs and reversed lower and Crude Oil broke up and out of 4th wave resistance calling into question the bigger picture trend. With the G20 summit this coming weekend, the Trump/Xi meeting and potential Iran conflict are critical as to whether we see an escalation of the trade wars. As...

US equity markets continue to be defined by impulsive rallies and corrective declines. This week's FOMC meeting will be important (key risk) as the market expects the Fed to reiterate its dovish bias. Keep an eye on Gold and the Yen as they approach major range resistance - breakout or fakeout? Equities reversed higher after completing a corrective 3 waves down of equality spurred on by the Fed's "we've got your back" comments early in the prior week. US equities completed a strong bullish...

Last week, equity markets confirmed our immediately bearish case as the SPX and DJIA confirmed the Nasdaq and Russell's break of support. The Yen, Bonds and Crude also confirmed the bearish market break as expected. Tariff man appears intent on dragging the world into a global recession. The reason we could expect the risk-off environment to continue despite equities achieving minimum downside objectives is the rally in Yen and Bonds. Both have broken up and appear incomplete. The Yen broke...

The bears remain in control - US equity markets declined last week into strong near term support while Crude Oil finally broke lower from targeted resistance. The bond markets pushed to new cycle highs as expected and the US dollar rally may have ended. Be aware of heavy Treasury issuance at the end of this week ($50bln new money raised). The SPX and DJIA declined to retest the weekly lows and held while the higher beta indices (Nasdaq and Russell) made new cycle lows. Hope springs eternal but...

Last week, global equity markets staged a recovery from the Trump tariff decline as expected. US equity markets remain most at risk given the direct conflict with China (unless Trump retreats). So far, the rally has met the minimum expected targets in the 50% - 61.8% Fib retracement range. This is a key week for risk assets as the bears need to make a stand - the immediate bear case is invalidated at new ATH's. Our key risk metric, the USDCNH, remains below key 7.0 resistance - the dividing...

From our last Realvision report on 4th Feb 2019 Tactical Traders Market - "Despite the bearish fundamentals, the most likely outlook is for an eventual push to marginal new ATH's". Since that report, the Nasdaq and S&P500 have indeed made marginal new ATH's while the DJIA and Russell 2000 have lagged. Inter-market divergences at market extremes provide early warning signs for market momentum. We view markets through the prism of fundamentals, technicals and market sentiment. Trump's...

Risk markets were rocked this morning as Trump rolled a hand grenade into the China trade negotiations. The timing couldn't have been worse as traders pressed VIX shorts and equity longs pushed new ATH's. Traders are not positioned for an escalation in the tariff wars. This is the first test for equity market bulls. Last week we tweeted the ES / SPX likely completed wave iii of (v) as we looked for a corrective decline into the 2890 support area. The immediate bull trend remains in tact while...