The collision of global markets and social mood

Wednesday, June 21, 2017

Weirdness With Google -- Was Locked Out

Google is acting evil. I've been locked out of the blog for days. The same computer that I log in with each and every day was suddenly not "recognized."

All I needed to do was enter my mobile phone number.

Actually, I think Google already had it. It already knew exactly which phone and model number it was.

Gone was the email recovery option.

No one to call. No place to send an email inquiry.

Just a maize of "help" and "support" topics, none of which was any help at all.

Then, as if by magic, it started working again.

Spooky.

It's probably not over.

It'll probably happen again.

Who knows if I'll even be able to log in again.

So...that's it for me. That's the end of the road with Google and Blogger.

Sadly, the alternatives don't look much better. But they're there.

The weird thing is that not writing out a plan for the past several days has felt strange. Something hasn't felt right. It's more than a habit now. It's become something that I simply feel better doing each day before I enter the fray.

So I'll continue somehow. I just don't know where.

Check Twitter, as that is where I'll post the new blog address when I've figured it out.

Thanks for reading. It's been a long time together.

Sincerely,

Marz Bonfire

Friday, June 16, 2017

Friday -- Quadruple Witching Options Expiration

S&P E-mini Futures:
Coming off best overnight levels.

Markets:
Asia was mixed and Europe is all green.

Quad Witching today: all four asset classes expire simultaneously -- stock index futures, stock index options, stock options and single stock futures.

Turns out BoJ's Kuroda was just kidding. That talk of stimulus reduction? Just trial balloons. Stimulus going nowhere, he says. Besides, we're still miles away from out inflation target.

Train wreck in making.

Mood:
Not politics, just an update on the Starbucks/Howard Schultz cycle noted back in December 2016.

Having just reached records highs, Starbucks may have gotten ahead of itself:

Starbucks customer says she was bullied for supporting Trump

Last December Starbucks CEO Howard Schultz announced he was stepping down . . . again. The first time was 2000. He returned in 2008. Another Fibonacci 8-years later, he announced he was leaving again.

Maybe a bottom in 2024?

Friday -- NFP, Peak Caffeine, China Repo Madness, High-Volume Highs

FX:
Skandies and AUD & NZD on the move, stronger. JPY weaker (barely) on BoJ/Kuroda but CHF still flashing red.

Treasuries:
Short-end implosion continues.

Energy:
WTI crude looking more bouncy this morning. NG consolidating a two-day rally.

Metals:
Green finally.

S&P Outlook:
Possible scenario for SPX with not one, but two clean stops. Reaching "5" later on would not be THE top but merely a tradeable top of some significance, possibly 100+ down.



Thursday, June 15, 2017

Thursday -- The Day After

S&P E-mini Futures:
Down hard, yet a bit sloppy.

Markets:
Asia and Europe red. Rough action, sharply lower.

Reality sunk in that that was no Dovish Hike. That was a whole lotta detail about draining $50 billion per month from the punchbowl.

Hearing and seeing "policy error" getting thrown around suddenly. A little late perhaps.

Policy error started back in 2008 with the bailouts and continued as the Fed attempted to "paper over" a debt problem with endless liquidity.

Debt can only be fixed by less debt.

So now we have the Fed, the BoE, BoJ, and ECB openly discussing balance sheet reduction and stimulus removal. Whether it's for real or just jawboning is not yet clear. But the liquidity pump may be slowing, and markets will need to sink or swim.

Mood:
Probably belongs here in Mood even though it's FX:

81% Euro bulls per the Daily Sentiment Index means very few dollar bulls, and it shows.


FX:
USD shot straight up after the Fed decision, statement, and press conference, all of which erased the Dovish Hike fantasy.

Widespread dollar strength continues against all majors.

Treasuries:
Yield curve (2s vs 10s) flattened considerably, along with 2s vs 30s. If it continues, things could get bumpy.

Energy:
WTI crude possibly gunning for its May swing low (43.76) but could turn at any time. NG showing a bit more grit, up slightly.

Metals:
Red and messy.

S&P Outlook:
E-mini futures have come off hard from yesterday's double top, but they haven't broken last Friday's swing point.

That level is 2412.50.

On the NQ it's 5643.25.

The S&P cash has a pattern which suggests higher prices may still be possible unless 2419.97 fails.

If it does, the gap at 2411.80 may become the next target.

The Dow laughed in my face yesterday, laughing off Janet & Co. as well, and closing close to its highs.

I may be wrong about it being the weak link, and will watch it carefully as a leading indicator. It could hold the clue to equities as a whole if it continues to hold up.

Wednesday, June 14, 2017

Wednesday -- Fed Day

S&P E-mini Futures:
Modestly higher overnight, challenging last Friday's best levels.

Markets:
Asia mixed with China down .73%. Europe green.

Fed decision 2pm with a news conference following at 2:30pm.

Mood:
Death Of Equities, 2017-style.

Death of the human investor: Just 10% of trading is regular stock picking

This is slowly but surely making me want to position for the return of volatility in a big way.

FX:
Wild action. AUD up over 1%. CAD smashed its April swing point finally. EUR & GBP up well. USD on the ropes. But JPY & CHF sending a warning signal.

Treasuries:
Ripping pre-Fed.

Energy:
Both WTI crude and NG down currently.

Metals:
Green ex-copper.

S&P Outlook:
Turns out this rough guide from last week wasn't so bad. The actual dip was a bit more shallow than depicted, so maybe the rally will be a bit muted as well.



With the Dow's new high yesterday, the SPX may be set for one as well. But FAANG action left a lot to be desired, thus NDX may have some trubs.

The way treasuries are moving though -- ripping higher currently -- maybe Janet isn't going to hike at all.

The weak link is the Dow in my opinion, and it's looking a bit shaky pre-market. But unless the S&P decides to bail, maybe it can muddle through. It did reach the 2440 level and does look like a small head 'n' shoulders.

NDX looks the weakest and has the most to prove. 5800-5850 is still possible. But it would still look better with a new low in "C" down.

Feeling the Fed is getting increasingly desperate to look "in control" so anything can happen.


Tuesday, June 13, 2017

Tuesday -- Weird Scenes From The Mood Peak

S&P E-mini Futures:
Modestly higher.

Markets:
Asia and Europe mostly green. "The tech rout is over." Haha.

Mood:
Rarely is the crowd short from the top.



Weird scenes from the mood peak:


Meanwhile, out in the Hamptons: "driven" by excess.


San Francisco cashing-in on tech again.



This Bizarre Italian Supercar Has A Built-In Fish Tank


A world awash in too much liquidity . . . eventually no one has any clue what to do with it.

FX:
CAD having issues with its April swing point? If so, it's the sort of thing that could make it go Loonie the other way.

GBP having a good day.

USD possibly setting up for a bounce continuation.

Treasuries:
Still a trend toward flattening, not good.

Also, yet more stuff you don't want to hear from Japan:

"10yr JGBs were lower amid an improvement in risk sentiment throughout the session, while today's 20yr auction later also failed to spur demand with the results mixed in which the accepted prices declined from prior."

Energy:
WTI crude down but trying to bounce, NG up but off early morning best levels.

Metals:
Red.

S&P Outlook:
The tech wreck is "over." It's now called "crash-lite." To me, it's just the return of a real market. One that expands and contracts like an actual person rather than an algorithmic imitation.

Did the tech wreck even start? Maybe a correction did. Hard to say. So far it feels like "surprising disappointment."

I do want to use a bounce to position for another probe lower in NDX, and be on guard for a possible new high in Dow, SPX, or RUT before lower prices.

Holding some remaining VIX 11 calls from last Thursday which I still think were a better deal than the NDX puts, even if the puts would have paid for my entire weekend up and back plus drinks for my entire class (small school, haha).

Current action feels like an ABC in NDX and perhaps a fake out in S&P, but either way, probably higher before lower.

Maybe a deep retracement in NDX to the 5800 level or perhaps even 5850.

SPX 2440 area could provide a juicy head and shoulders for everyone to get excited about.

Monday, June 12, 2017

Monday -- Back Home Barely

Miss one day of work Friday, market tanks. Flight home from Boston delayed until midnight. 4am arrival. 1.5 hour nap in car. Trip to supermarket on way home. Shower. Futures crater overnight after a flat open Sunday. Bloomberg running helpful story... Tech Selloff Spreads: Why tech stocks are taking a tumble. Maybe they were overvalued? Asia and Europe decline. Treasuries decline, yields rise. Energy rallies.

Doubtful the market decides its fate in one day -- a summer Monday no less -- unless NQ 5557 along with ES 2341.75. Got VIX from Thursday. Going to sleep until the afternoon session. Good luck.

Thursday, June 8, 2017

Thursday -- Eye On The Ball: The BoJ

Note:
No blog Friday. Heading back to the States for Alumni Weekend and High School reunion.

S&P E-mini Futures:
No new high overnight, while NQs made one.

Markets:
Not Comey, not the UK elections, not the ECB (which moments ago dropped guidance on rate cuts in a step toward exiting stimulus) -- the real news is from the BoJ:

"The yen rose and Japanese bonds fell as the central bank was said to be re-calibrating its communications to acknowledge it’s thinking about how to handle a withdrawal from monetary stimulus" -- Bloomberg

This is not about success by the BoJ to conquer deflation. It's acknowledgement of failure.

As in they can't afford to keep going.

As in look out below when the markets figure it out.

Rates are moving higher around the world so far this morning.

Mood:
Taking their cues from a supermodel (Giselle) a while back, British Football players demand to be paid in Euros

Wonder if it has anything to do with weak GBP sentiment and sky-high EUR sentiment -- currently at 89% bulls.

Short EURGBP may be in order.

FX:
JPY reversed and weakened considerably after the BoJ news hit, a sign of disbelief possibly. Or a sign that the current market momentum can last for a while longer, one that I agree with.

Treasuries:
Prices red. Slight buying tails appearing, however.

10-year JGBs "sold off aggressively" on the BoJ story, never a good sign.

Energy:
WTI crude faceplanted yesterday after DoE data showed a huge build in inventories.

Guess we know not to trust API, which only a day before reported a draw.

WTI and NG both down. Maybe crude can bottom around 45.

Metals:
Gold and platinum lower. Copper and palladium higher. Silver trying to turn from neg to pos.

S&P Outlook:
Both the SPX and NDX kept the pressure on higher prices, with the NDX quickly negating the possible impulse down yesterday.

This should at least target the 2440 and 5900 areas respectively.

Hope it doesn't happen Friday when I'll be away from the screens.

Option shopping:

1) A 15-day .74 delta QQQ put asking 4.62

2) A 19-day .75 delta VIX call asking 1.55

I think I see the better deal.

Might get some for Friday, just in case, if VIX can get back under 10.

Even if there's a market rally Friday, VIX might stay where it is or even firm up.