The Mars Market Update — Live Research

Last week saw the US equity markets decline from marginal new highs as tax break buyers failed to follow through. Bears didn't do any structural damage to the markets. While we are looking for a small degree 4th wave correction, we cannot yet rule out the possibility of this SPX wave (iii) extending higher towards our 2680 target before the correction takes hold.  Bigger picture, we remain in a bull market and it is tough to fight the positive seasonality into year end. While Bonds and the US$...

Last week's update ran to script with the ES and RTY hitting near term upside targets of 2654 and 1540 respectively before selling off dramatically on "news" regarding the FBI investigation. The "greed is good" tax plan continues to dominate US equity buying as this bull market continues to extend higher into the new year. Friday's volatile session tells us two things: (i) this one-sided market is leaving behind large air pockets of risk (ii) dip buyers remain in control. Friday's 50pt drop in...

Apologies, but given I am travelling this week, I am only able to provide a brief market update. Back on deck next week. US equity markets continue to look bullish with new ATH's with the SPX thrusting higher from the wave (iv) triangle we highlighted last week. Natural ES targets are 2620 then 2654 for this wave higher. ES remains near term bullish while we hold 2568 to the downside (end of wave (e) of (iv) and start of this latest impulse higher). The question is whether this wave is all of...

Note: I will be travelling the next week after Thanksgiving but will try to update charts whenever possible. Key observations from last week: - Russell 2000 rallied impulsively from support (bullish) - European stock indices declined impulsively from upside targets (bearish) - USDJPY declined to initial targets in the 111-112 area - DXY and Euro whipsawed H&S and deciding what to do next (neutral) - Bond markets sent mixed messages and could not break down (neutral) - PM's broke higher...

Global equity markets appear to have topped near term while Bond markets reversed sharply lower as expected from important near term resistance levels as the US$ continues to struggle to make upward progress (while still holding key near term support). This is a big week for Bond markets and the US$ - it is a heavy data week with CPI and Retail Sales the key focus for these markets. Note: Due to Veteran's Day the CFTC COT data will be released tomorrow. I will include the sentiment data when...

Last week saw a deluge of news and data including a new Fed Chair announced, a tax plan, BOE rate hike, strong US earnings and dovish BOJ. Importantly, equity markets continued to grind higher along with bonds, while the US$ held support and Crude Oil has attempted a breakout. This week has the RBA and RBNZ on deck with the latter likely more important given the recent Kiwi$ weakness and new government. The global equity markets continued higher in a goldilocks environment with strong earnings...

Last week was important for the macro outlook with the ECB backing away from Balance Sheet reduction and instead maintaining very loose monetary policy. This resulted in a spike down in the Euro as Bunds rallied and the EU-US spreads tightened. We now have the BOJ and ECB confirming a dovish outlook with the FOMC on deck this week to signal its intentions. Likely an important week for the US$. This is a heavy week for data and headline risk with Central Banks (BOJ, BOE & FOMC); Eurozone...

Summary observations: - a big week for bonds to see if TLT can bounce off its 200 day sma and hammer out a near term low - USDJPY breaking above 114.50-115.00 will likely signify an acceleration lower in Bonds and PM's - ES has enough waves in place to complete its impulsive rally - no signs of a reversal as yet - equities vulnerable here "if" bonds can hold the lows - Crude nearing the top of its range - $54 resistance The global equity market rally continues unabated. There are NO signs of...

Important Note: This week I will be travelling and visiting family. I will still be available for questions but responses may be delayed. Apologies in advance. Last week we had good follow through on the turn we identified in the Bond, PM and Yen complex. Equities continued to grind higher with no signs of a reversal.  Thoughts: - ES and YM may be wedging into a near term high ending diagonal - US$ declined impulsively as expected, supporting the PM and Bond rally SPX continues to rally. We...

The global equity bull market continued higher last week as expected with the Nasdaq Indices finally confirming the recent highs of the majors. Late last week we were looking for a spike low to be formed in the Bond, PM and Yen complex. Friday's NFP provided a hammer low in an important support zone which now needs follow through higher to confirm a near term change in trend (a hammer without follow through is just another nail). We are bullish against last Friday's lows. Thoughts: - equity...