tsptalk's Market Talk

[weatherweenie]

Markets are holding up a lot better than I expected.

Ummm :notrust:, a literally unbelievable jobs report for September more than doubling estimates has futures tanking.

We say we wanted capitulation? This may be it.

Markets don't usually bottom on Fridays but if somehow today closes positive after the S&P futures were down nearly 50-points before the bell, we could have one. If it closes closer to the lows, more downside early next week but we're getting closer to either a low -- or a crash.

 

[tsptalk]

I'm not sure what trading volume is right now compared to normal, but the bulls do want to see a spike in volume today, whichever way it ends up, to get that capitulation feel.

 

[tsptalk]

The probability of a Fed interest rate hike at the November meeting is 31%. That's up from yesterday's 20%.

31% even seems low considering the jobs report.

 

[tsptalk]

The 10 year T-Note yield and the dollar are up, but both are well off their highs. The stock market is following in the opposite direction, as we'd expect...

 

[tsptalk]

Because of the violence in the middle east this weekend, the S&P 500 futures were down about 40 points when they opened Sunday evening. It's now about 28 points so it may be an overreaction.

But, because of the holiday, any TSP transaction wouldn't be buying or selling until COB on Tuesday and that's seems like an eternity from now (Sunday evening.)

 

[tsptalk]

Oil is jumping after the Hamas attack, and the dollar is up. The bond market is closed but the 10-year yield future is slightly lower and that may be what is keep stocks close to flat after the geopolitical event.

Gold is up $13 and is quite oversold since the 10% off its highs since the spring.

 

[tsptalk]

The 10 year yield is down sharply, the dollar is down slightly, and oil is down $1 a barrel helping the stock market tack onto to its bounce off the lows and some key moving averages.

The VIX is back below its 200-day EMA and the Transports broke out above its 200-day.

There is more resistance overhead but so far so good for the relief rally, or whatever it turns out to be.

 

[tsptalk]

 

[tsptalk]

Yields were down at the open this morning despite the hotter than expected PPI data.

It may be at some short-term support in the 20-day EMA. Good test to see if this is a temporary dip, or a change in trend coming for yields.

Stocks opened moderately higher as the bounce off the lows continues, but may be getting short-term overbought. People are still bearish and underinvested so dips may be shallow.

 

[tsptalk]

Talk about a pivot point for the S&P 500 before tomorrow's CPI Report...

 

[tsptalk]

Stocks are stalling at resistance this morning after the CPI Report failed to show much relief. We know bond yields, which are up this morning, have moved dramatically higher this fall and the Fed has mentioned that they may not have to raise again this year. So while the reaction to the CPI is muted, the charts suggest the easy money off the lows may have been made already.

Stocks don't have to tumble back to the lows, but they may need to digest recent gains to come off the short term overbought conditions.

Small caps are more vulnerable to higher borrowing costs.

 

[tsptalk]

Mike Santoli has been talking about this year's correlation to the 2021 market for a while now...

 

[tsptalk]

What just happened to stocks? Yields and the dollar.

 

[tsptalk]

 

[tsptalk]

Oil and the dollar are down slightly to start the day, but yields are up, and so are stocks, which hasn't been the trend lately. What has been a trend however are the 14 straight positive Mondays.

There's a lot going on in the world but this morning investors are not concerned and doing some buying. Is it a coincidence that stocks are up again on a Monday, or a real trend?

 

[tsptalk]

It's the daily test of the 50-day EMA.

 

[tsptalk]

Strong retail sales are pushing the dollar up and ripping yields higher, and that put pressure on the stock index futures. Yesterday's bend but don't break reaction to higher yields is getting a little too tense as the 10-ear Treasury yield flirts with recent highs.

The consumer is strong, but are they too strong to keep inflation down?

 

[tsptalk]

Small caps have led the last couple of days for a change. The S&P 500 (C) has not been able to break above its 50-day EMA - today is day six. Small caps (S) don't have the immediate resistance, but that's because it was hot so hard late last week and since the summer peak.

 

[tsptalk]

Yields are up, the dollar is up, oil is up, and geopolitics are dominating the headlines.

It has become a risk off kind of day. Small caps are backing off from their two day rally.

It's an expiration week which means an edge to the bulls but also more volatility. Some charts are cracking while others fall into the "buy the bottom of the ranger" zone. Which should we believe?

 

[tsptalk]

Yields are up, the dollar and oil are down. It may not hold but stocks are trying to hold up because 2 out of 3 ain't bad.

Netflix's earnings and pop higher aren't bringing any contagion to the broader market because their success had more to do with their effort to crack down on password sharing.

Earnings reports are coming in heavy now but the big names are still a week or two out.

Powell speaks today and we may have a quiet market until he does.