$ES_F 1406 for a hold for now, can the bulls take it to the 1424.75 goal line? $Study

The brakes are on, but the train just keeps on a comin’


Around the Globe

    Asia – CLOSED

  • Shanghai (China) +0.25%
  • Hang Seng (Hong Kong) +1.23%
  • Nikkei (Japan)+0.51%

Europe as of 6:19am EDT

  • DAX (Germany) +0.23%
  • FTSE (UK) +0.46%


Today’s Economic News:


You can always count on Thursday to bring the news around. China news was weak, which I guess was good as it means intervention.  The German GDP numbers were OK, but it was the PMI numbers that make this report bullish this AM.  A turnaround from the last series of PMIs where manufacturing looked bad and services OK.   In the USA we have the weekly jobless claims numbers, our own PMI number, and at 10am New Home Sales… It should be a mover as we have a little bit more volatility in the markets. 

Quote of the day:
The height of cleverness is to be able to conceal it. – Francois de La Rochefoucauld

Current Breadth Readings: (click here to see all our breadth charts)


If you are in the email reading this, make sure you scroll down and read the comments about the loss of this chart to Neutral.  If you are on the website, click the link at the top and read today’s report.   We could be starting divergence land here where the train keeps a movin’ to the upside without breadth.  The clue is watching the 15 DMA cross for a sustainable turn to the downside.


ES SP500 Futures Comments:

Short: 1430
Long: 1394

Yesterday’s 10+ day with a good test and hold of 1406 plays out well for the bulls right now.  The upside extension target now sits around 1430 and the downside tweaked up just a wee bit to 1394.  Globex highs got us back up to 1418, just 6.75 shy of the highs.   Right now the bears are betting on a lower high being put in place to scare out the first set of profit takers.  We do think the markets are quite bullish, but you can begin to play the game from both sides now as the market struggles to go higher.  A couple more days of breadth data will help us better understand where we are in this bull run cycle.

So it is easy in here to know the goal posts.  Today the bears want to move the ball below 1406 and the the bulls want to move it up to 1430.  If that were to happen today, it would be another +10 day and we think that is very probable.   The markets should begin to get range bound as the battle for sentiment begins.



US Dollar DX Futures Comments:

80.85 is the downside target from here.   It didn’t take long to really get going below the 82 level.   It should take a little longer, like a few days, to hit that 80.85 area though.   All this downside on the USA Dollar is good for the markets.  Watch the semis and global high-tech ride the dollars fall (along with oil Sad smile)


TLT Twenty Year Bond ETF Comments:

Although TLT did not pay very much respect to 125 on the downside, we thought there would be a pause there. We do think there will be some halt here to the upside in that area as TLT corrects from the fall.   Our downside target remains at 118.50.  We need to work this weekend and get back in sync with TLT and produce an upside target.  Our last target of 135.50 was not hit. Time to lower upside expectations.


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