The collision of global markets and social mood

Friday, December 18, 2015

Friday -- Witches Or Yen?

S&P E-mini Futures:
Down in choppy op-ex trade.

It's the yen man. As tempting as it is to explain away this morning's volatility on Quad Witching and huge imbalances in expiring put positions, it doesn't explain why Asia had a rough night (especially the Nikkei) and why Europe is down hard.

The yen explains it. Yen got messy last night when BOJ's Kuroda didn't give the market more stimulus.

The medicine isn't working.

Meanwhile the whole world is short the yen, believing that the medicine will work . . . . someday.

When things go wrong, belief evaporates and short yen gets covered.

Watch the yen.

(It's forming a big huge daily doji, so the worst may be over for now.)

JPY wild ride overnight, currently stronger. CHF stronger too. Can be a toxic mix.

Prices are higher today. Still not out of the woods yet.

WTI crude down, marginal new lows (possible reversal set up). NG up, trying to hammer out a bottom.

Gold, silver, and copper up.

S&P Outlook:
There is a 1:1 Fib extension target from the Fed Day high at 2030.22. There is also a gap at 2021.94 near a 61.8% Fib support level, and a volume shelf at the 2010-2012 area. I added SSO longs in the pre-market.

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