The collision of global markets and social mood

Friday, February 10, 2017

Friday -- Full Moon, Lunar Eclipse, Unshakeable

S&P E-mini Futures:
Another overnight record high in futures.

-- Trump backs "One China"
-- US Court of Appeals overturns Trump's executive order on immigration
-- Republicans are discussing a carbon tax
-- Obamacare repeal is delayed

This is not a political rant. It's a reminder to expect the unexpected.

Even OPEC stuck to its promise of production cuts. Incredible.

Yields higher again in Italy and Spain.

Thinking lately the unexpected will eventually be Germany.

Social Mood:
With stock markets at historic highs, valuations in the 99th percentile, and surging investor sentiment bordering on euphoria, the latest Tony Robbins investment book is UNSHAKEABLE.

His three best sellers were Unlimited Power released in 1986 (before the crash of 1987), Awaken The Giant Within in 1991 (at the dawn of the tech rally), and Money: Master The Game in 2014 (during the recent two-year correction). Seems Robbins has a knack for mood inflection points.

From the book jacket:

"Tony Robbins returns with a step-by-step playbook, taking you on a journey to transform your financial life and accelerate your path to financial freedom"

"This book will provide the tools to help you achieve your financial goals more rapidly than you ever thought possible"

". . . a simple, actionable plan"

" . . . a few simple steps"

Socionomically, Robbins seems to be a bull market personality reflecting the aspirations of millions to achieve more by being better.

In a social mood sense then, he may be reflecting a current zeitgeist of power over markets resulting from decades of central bank support.

"Unshakeable" therefore seems analogous to the buy and hold, set it and forget it mentality that is driving record number of investors to passive index investing.

Unshakeable also sounds like being rigid when we should learn to expect the unexpected.

Having a plan is great. But knowing when a new one is needed is just as important.

Current excessive sentiment suggests readers might want to balance being "unshakeable" by reading Nassim Taleb's Antifragile: Things That Gain From Disorder. Have never read it myself.

Maybe I'll do a fly-by on each the next time I'm in a bookstore.

Quiet here for now. Good. But CAD ripping on OPEC news.

NOK under pressure as Norway edges toward deflation.

Bitcoin down again, almost another 2%.

Prices turned messy yesterday and look messy so far this morning. Gaining conviction that yields will rise after this ABC bounce exhausts itself.

WTI crude should have gone to the moon on the latest word from the IEA that OPEC stuck to its production cuts and that energy demand fell. Instead, WTI rallied just over 1%. It's up almost another 2% currently, but has yet to take out its swing point.

NG getting pounded as its recent rally morphed into a 3-wave correction. New lows likely (below 3.006). 3.494 could be a long wait.

Gold had a sharp reversal yesterday on heavy volume which was also confirmed by silver and platinum.

Palladium, also a precious metal but with a big industrial component, did not confirm, and has been trading higher along with copper, both higher today.

S&P Outlook:
Strong rally yesterday which ended with a clear 5-wave decline, yet e-mini futures saw new highs overnight.

The daily NYSE Advance/Decline line has not cracked yet, so even with the S&P in progressively thinner air any pullback should still be met with buyers.

On the other hand, the intraday Advance/Decline line is showing some weakness over the last month, so a pullback could be expected at any time.

Today, however, with a full moon and lunar eclipse occur after the market close, prices may be pulled still higher before any reaction appears.

Clearing the 2300 level opened the door to higher Fib targets of which there are several up to 2323.71.

Below 2300.99 would likely be seen as bearish (false breakout).

Would be a buyer of anything in the 2280 area.

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