The collision of global markets and social mood

Friday, August 21, 2015

Friday -- Op-Ex, Danny, Vacation Over

S&P E-mini Futures:
Currently 10 points off the overnight lows.

Back from vacation and into the fire.

First, my internet was down when I got back. I had turned off the modem and the server lost track of it. No technician available until August 24th. No problem -- my awesome neighbor gave me his wireless password. "Don't worry, bro! I got 1 gig down. I can power the whole building!"

It's fast.

My car (due to arrive . . . August 24th) is somewhere between Jacksonville, Florida and San Juan, Puerto Rico -- headed into a strengthening hurricane.

A hurricane that is heading toward me.

Oh, and it's August op-ex.

. . . What Is It About July Op-Ex?

Remember the cocky timestamp from July 20th?

Found this yesterday from a guy who has cried wolf at every major low since 2012 or so.

The S&P could be in a heap of trouble, but it has yet to retrace even 38% of the move from the October 2014 lows.

Watching strength in JPY, concurrent with equity weakness. Cautionary.

Yields lower, prices higher, yet charts still look dubious.

WTI crude still weak. NG still nowhere'sville since May.

Gold has caught a bid over the last several weeks. Silver doesn't look as clever.

S&P Outlook:
Two major swing points were broken yesterday -- 2044.02 & 2039.69.

The Dow and the NY Composite look to have failed.

The Dow broke the equivalent of 1980.90 on the S&P cash.


However, VIX term structure may suggest an interim low between now and maybe +/- 5 days.

In other words, I'm not shorting here.

If anything, I'll buy weekly calls to partially hedge UVXY and TVIX.

As for the S&P, it could be making a smaller wave four low in the next few days, or it may have made a larger wave 3 top.

Please note, I have never seen an Elliott wave truncation in real-time, and do not know of any valid ones since the 1982 low. I usually doubt any wave count that suggests one, but based on the way the Dow has broken down, one may have occurred.

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