The collision of global markets and social mood

Wednesday, February 25, 2015

Wednesday Market Update -- Norway, NASDAQ, Yellen's Finger

News:
Take a look at what falling oil prices can do . . .


That's over a 45% hit from an already downwardly revised number.

It is doubtful that these consumers are rushing out to consume more because the price of gasoline is less.

Meanwhile, CNBC, yes CNBC (using data from Factset), notes that as the NASDAQ closes in on historic, all-time highs all of the year-to-date gains are concentrated within just five stocks.

Source: CNBC

It is equally doubtful that reaching the 5,000 level will suddenly mean everything's been healed from the tech wreck in 2000, but that central bank liquidity injections really do work.

Gains resting on just five stocks is the same exact set up that caused the tech wreck in the first place.

ES Futures:
Flat, yet poised for higher highs.

S&P Outlook:
Closing above 2114.42 keeps pressure on 2133.38. The structure is wedging, however, as A/Ds, ticks, TRIN, and volume continue to signal weakness. The VIX is also closing in on significant lows (12s) where I will be a buyer.

FX:
USD buckled during Yellen's senate testimony yesterday, but did not break the consolidation structure it has been in.

Also, this is Yellen not so subtly reminding the Senate what the Fed thinks of "auditing the Fed." This sort of arrogance will backfire on them in the aftermath of the coming debt liquidation


Bonds:
Bounce mode for now. With any luck, 2s-30s will make new highs for an epic shorting opportunity.

Energy:
Crude and NG remain in a sort of No Man's land from a risk/reward standpoint.

Metals:
Gold's rally must extend far beyond it current gains if it wants to get traction.

Special Situations:
Regarding the NASDAQ Fab 5:

As AAPL closes in on the 141 & 144 Fib targets, it's also closing in on a 8-year trend line, and volume is drying up as the mantra becomes the world's first trillion dollar company. Then what. Cars?

AMZN is rocketing higher on very little volume and has a multi-decade Fib extension target in the 460 area which could be muted if it gets above 408.06 with much less than 81 million shares.

BIIB is wedging into a Fib extension target at the 417 area.

GILD looks primed for new highs yet has lots of supply at the 85 area.

NFLX looks extremely wobbly and any new highs above 489.29 should be approached very carefully.

Bonus:
Investors Intelligence is out with their latest readings -- the bull/bear ratio is above 4X.

This chart, by must-follow @Not_Jim_Cramer, is possibly his best insight ever.








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