The collision of global markets and social mood

Wednesday, January 20, 2016

Wednesday -- Pure Fear, Social Mood & The S&P

S&P E-mini Futures:
Cratering.

News:
Fear is back. Pure fear.

From Bloomberg:


“It’s back to oil and that’s what is driving everything,” said Barra Sheridan, a rates trader at Bank of Montreal in London. “We can easily run more because it’s pure fear. I don’t know what we need to change this sentiment.”

Forgot to post these yesterday. A couple days old now, but the point is still the same: mood is dark.







Today at Marketwatch --

Maybe, if you live in the Northeast

Psychology runs the market.

Journalists broadcast prevailing psychology.

Prevailing psychology -- social mood -- is exceedingly negative at the same time that market internals are showing selling exhaustion.

In Elliott wave terms, it continues to fit best with the "surprising disappointment" of a wave 4 correction.

FX:
Much different day from yesterday. AUD & CAD weaker (which, according to Zero Hedge, has fallen every day this year). CHF and JPY stronger. Risk Off.

Treasuries:
Doing what they should be doing: ripping higher with a steepening bias.

Energy:
We're told today's global market pummeling is all about WTI crude's latest decline, whereas both term structure and rate of descent say "careful with that."

Metals:
Gold bid, silver flat currently, copper down.

S&P Outlook:
There is a 200% Fib extension target at 1838.18 which could come into play today.

I continue to like the simplicity of the weekly chart which has the 50 week moving average at 2052 and the 200 week moving average at 1782 and expect a lot of large players, commercials, and institutional trading desks to view the same range.

Therefore I stick with this chart. I still think "b" could reach a lot higher than shown, and I think "c" of C of 4 could extend lower too.




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