Oil beginning to threaten SIFs

1412 Imminent. Buy there with the idea of reversing at any break of 1412. Otherwise, hold for four handles long and then SAR for the head and shoulders top if you are aggressive. Otherwise just take profit and wait for either 1412 or 1420 to resolve.

There is a massive seller at 1417.xx to 1420. It is a Maginot line.

nitro
 
The price action towards the close is terrible for bulls.

I would be at best cautious if I were playing an earnings call after hours.

nitro
 
Market reacting to CSCO and DIS news after hours. Imo, these earnings were very likely, and already priced in (CSCO and DIS are big beneficiaries of a weak dollar).

nitro
 
1420 SPX continues to be the line in the sand because there has been no close above 1420 SPX. Intra day, there have been penetrations of that level, but that is not what matters.

Nothing has changed as far as strategy goes. Today is a blah day, but as I write this, I would be cautious if you are a seller.

nitro
 
This has turned into an ugly day for SIFs. A little surprised, but not much.

See the quote above on selling at market extremes. Those that had the courage to sell to institions at major resistance, are now ringing the cash register taking profits on the way down, or they may take 1/2 and hold 1/2, etc.

Notice how worthless 1400/1410 SPX are as major S/R. It cut right through them as if they didn't exist.

1392 SPX is a support level. Then 1370, then 1350. To the upside, it is 1420, and that is a critical level of the most strategic importance.

nitro
 
Unusual trading action today, but unusual is turning into usual these days.

NQ giving this market a boost to the upside. I would be cautious if long (I seem to be cautious every day, but this market is crosseyed) and would sell on any weakness that looks terminal.

nitro
 
QM about to go out at another extremely unstable price of just a nose hair below $125.00

Options strategies are well worth looking into here.

nitro
 
At some point, the title of this thread changes from "Oil beginning to threaten SIFs" to, "Oil sent the US equity markets into a deep recession".

I don't know what the price is, but we are within view of it now imo. This last spike may be due to diesel, but who the heck cares? The result on the consumer is the same.

If the conservation laws of Physiscs have their counterparts in economics, one day soon SIFs will puke unless oil backs off. As it is, one wonders what planet these people buying SIFs are on, imo.

ES would be down 10 if it were not for NQ, which is getting flows. I have no idea why anyone in their right mind would be buying tech on a likely rising or at best sideways interest rate environment. Someone has sold the market that the second half of this year is going higher. Tenous at best.

nitro
 
Nothing new. As I write this, I would be careful if short, and less careful if long, but this market is tenuous on both sides.

IRs have been holding steady to sideways. The curve seems flat almost to end of 08, which is probably why people are more optimistic than not (optimistic in the sense that higher rates don't look likely. Normally a flat curve is bad for SIFs).

What I am looking forward to is the shape of the curve on or right before/after we break 1420 SPX. It will be interesting to see if SIFs lead the bond curve, or other way around. Then other dominoes may fall, like the dollar going higher, etc.

Oil futures steady. Selling it is very dangerous, and buying it while less dangerous, is probably unwarranted in the short term. NOAA will be the next harbinger of oil moves, imo. Careful following of El Niño is critical during summer imo:

http://www.noaa.gov/
http://www.elnino.noaa.gov/

1392 SPX was support. Now it is probably only minor support, and 1370 is the only real support short term. Only 1420 SPX is real resistance now.

nitro
 
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