Bigger Picture
Saturday Review’s recording (for 2/6/16) … Crossroads.
“When you come to a fork in the road, take it.”
That’s where the market is, and that’s just what it might do… start trending in one direction and then reverse. Or, it might simply collapse, still being in the orbit of recent lows, with a bigger decline still ongoing. We discuss that in this weekend’s Saturday Review, recording, while also addressing attendee questions and comments.
The following stock requests were reviewed in this order:
LOW, HD, AAPL, GILD, CSCO, GDX, WMT, CAT, DD, FEYE, FIT, DUK, GOOGL, SC, PRAA, LNKD, DATA, VZ, T, OAK, NSC, ABTL, CACC, CLX, FB, SIG, SLB, DDD, IONS
02/06/2016 09:29:52 William: gm
02/06/2016 09:30:14 sm: 5×5
02/06/2016 09:30:26 casjf: gm
02/06/2016 09:30:39 David B: good morning
02/06/2016 09:31:49 Bill G: gm
02/06/2016 09:31:55 Mark Glezer: gm
02/06/2016 09:31:56 casjf: yes
02/06/2016 09:31:58 charlie: hi0
02/06/2016 09:31:58 tom: good morning
02/06/2016 09:32:00 William: yep all clear
02/06/2016 09:49:07 MK: or lack of news
02/06/2016 09:49:17 MK: everyone is positioning for a yuan deval
02/06/2016 09:49:22 MK: if it doesn’t happen
02/06/2016 09:49:28 MK: we might rally hard
02/06/2016 09:49:31 William: Interesting , I thought the market was reading for a capitulation….
02/06/2016 09:53:02 MK: also wasnt’ the 2/3 low optimistic from the 1/27 low?
02/06/2016 09:54:07 David B: the fact that sellers did not take control on Friday is there any correlation in any of the indicees outperform/undrperform. The dow on fri outperformed
02/06/2016 09:54:25 David B: underperform
02/06/2016 09:55:03 David B: the dow on fri outperformed
02/06/2016 09:57:14 (Private to Presenters) – tom: Rod I sent a couple of new prospects to you just wanted to let you know
02/06/2016 10:00:22 MK: why is 1/14 not part of the disucssion
02/06/2016 10:03:33 William: But if we dropped overnight you always say it doesnt count. So opening around 1880 would have more strenght ?
02/06/2016 10:05:14 MK: i used jan 14 moves
02/06/2016 10:05:17 MK: as basis for a lot of my calc
02/06/2016 10:06:29 William: k
02/06/2016 10:08:07 MK: the jan 14 move from 1875ish to 1925ish
02/06/2016 10:08:11 MK: has been relevant in my calcs
02/06/2016 10:08:13 MK: for levels
02/06/2016 10:08:43 MK: yes
02/06/2016 10:08:51 MK: and its low
02/06/2016 10:08:58 MK: you were talking about the other lows
02/06/2016 10:09:02 MK: as relevant
02/06/2016 10:09:05 MK: and you didn’t include it
02/06/2016 10:09:07 MK: as a low
02/06/2016 10:09:10 MK: and i was wondering why
02/06/2016 10:09:15 MK: yes
02/06/2016 10:09:30 MK: just curious as to why you omitted it
02/06/2016 10:09:32 MK: academic question
02/06/2016 10:10:00 MK: ok
02/06/2016 10:10:02 MK: interesting
02/06/2016 10:10:02 William: because the trend channel only starts after ? Wasn’t the reason?
02/06/2016 10:10:02 MK: thanks
02/06/2016 10:10:34 MK: trying to understand why i gravitate to stuff that you don’t find as influential
02/06/2016 10:10:38 MK: and stopping it
02/06/2016 10:10:56 Mark Glezer: is pessimism around 1924 has any influences?
02/06/2016 10:11:17 Mark Glezer: does it have I mean?
02/06/2016 10:12:04 sm: I’ve been anticipating a retest/probe of 1850, especially after Mon failed to confirm the attempted break higher. I think that you said this scenario is ‘1b’. It wasn’t clear to me in your comments whether you have a reason to discount the maket’s ability to launch a more successful rally attempt once a break below the range proves to be false (it recovers back into the range and then up through it)?
02/06/2016 10:12:45 William: no the one on the other chart is clearer
02/06/2016 10:13:02 William: yes sorry
02/06/2016 10:13:42 MK: apologies for the digression, but it helps me a lolt to have these discussions
02/06/2016 10:15:20 sm: So a corrective bounce can’t happen now?
02/06/2016 10:15:33 William: MK – I found it great to be able to learn and express our ideas. And thanks Rod :)
02/06/2016 10:15:35 Mark Glezer: gapping down Mon is likely to bounce to Fri range first or it would depend on how deep?
02/06/2016 10:15:51 tom: so if 1850 is broken then you woulx pect pretty quick descent to 1805
02/06/2016 10:16:10 sm: So then a probe of 1804 is required before seeeing 1950 and higher?
02/06/2016 10:16:14 tom: would expect
02/06/2016 10:16:19 David B: if we get past 1796-1798 what levels beyond that can you see?
02/06/2016 10:16:43 Bill G: Why not a simple .618 of the 1804/1940 be a refueling of buyers?
02/06/2016 10:17:53 Bill G: Seem like it would trap bears
02/06/2016 10:18:01 sm: So then what is the scenario that accomplishes the higher highs that you projected?
02/06/2016 10:22:11 David B: 1465 capitulation?
02/06/2016 10:22:48 MK: monday?
02/06/2016 10:22:52 MK: 1465
02/06/2016 10:22:55 sm: :)
02/06/2016 10:23:01 MK: =)
02/06/2016 10:23:19 William: come on, you are better thant that :)
02/06/2016 10:23:59 sm: That’s sort of my thought too, Bill.
02/06/2016 10:25:43 David B: will oil be a major player you think play out in the different scenarios you have pointed out?. It seems like during the day when the market turns its related to the price of oil.
02/06/2016 10:29:29 Bill G: ok. I think a failure of the 1865 area that reverses and rallies hard above 1950 would get the most people bullish at the wrong time before a significant decline.
02/06/2016 10:29:54 MK: re: OIL
02/06/2016 10:30:02 sm: I agree Bill. I just can’t get a clear read if that’s what Rod is saying too.
02/06/2016 10:30:11 MK: rod i read somewhere that we are about 6-9 months from a storage disruption
02/06/2016 10:30:12 ljr mobile: can u go over the automatic buy of productive bounce limit being revisited
02/06/2016 10:30:18 MK: and while improbable
02/06/2016 10:30:20 MK: if that happens
02/06/2016 10:30:22 MK: single digit oil
02/06/2016 10:31:21 tom: hes cut was the first to cut there dividend this week and as soon as they did oil reversed
02/06/2016 10:32:47 MK: When you run out of tanks to sore the oil
02/06/2016 10:33:15 MK: thats what i said
02/06/2016 10:33:24 MK: single digit oil
02/06/2016 10:34:15 ljr mobile: ok
02/06/2016 10:34:37 ljr mobile: no prob I’m driving right now
02/06/2016 10:34:51 David B: when you have down or up days where buyers/sellers gain traction can these be weak buyers or sellers or are they always strong hands?
02/06/2016 10:35:01 MK: I”m more than willing to talk tactics while its happening
02/06/2016 10:35:28 David B: yes
02/06/2016 10:35:42 tom: can you look at LOW,HDGOOGL
02/06/2016 10:36:09 MK: I have to go so stocks
02/06/2016 10:36:40 MK: LONG (AAPL GILD SC PRAA OAK NSC)
02/06/2016 10:36:59 MK: SHORT (ABTL CACC CLX CP FB SBUX SIG SLB)
02/06/2016 10:37:06 MK: dont’ feel that you need to cover them all
02/06/2016 10:37:07 William: CSCO
02/06/2016 10:37:11 MK: just a brain dump
02/06/2016 10:37:28 David B: GDX,WMT
02/06/2016 10:45:47 Josey: CAT, DD
02/06/2016 10:46:52 tom: thx
02/06/2016 10:48:14 ljr mobile: FEYE, FIT…curios about LNKD, DATA… no positions in any
02/06/2016 10:54:53 casjf: DUK I sold, so now it’s up ;)
02/06/2016 10:55:19 casjf: still think it’s going down with the ship?
02/06/2016 10:57:43 David B: VZ,T
02/06/2016 11:26:48 Josey: ddd
02/06/2016 11:30:41 casjf: IONS
02/06/2016 11:33:38 Josey: Great session, TY!
02/06/2016 11:33:45 David B: thanks
02/06/2016 11:33:51 William: Many thanks, great seesion
02/06/2016 11:33:57 casjf: thanks!
02/06/2016 11:34:18 Mark Glezer: thx
Saturday Review Link
Did Friday’s slide wind up the market for another corrective rally leg? Or, did it begin the decline’s resumption, at least to retest recent lows? How will we know either is developing, both Sunday night and Monday morning?
Be sure to join us at either link below by 9:30am ET for this weekend’s Saturday Review.
We’ll discuss the bigger picture, and then review any stock charts that you request.
Daily Spot…
A daily summary of high-profile members of several complexes… View a more detailed discussion of each chart at the end of today’s Market Wrap.
Eurodollar Mar Contract (EC, ETF: (FXE, UUP))
Having entrenched the uptrend Thursday with a confirmed breakout, Friday dipped back into Wednesday’s range, stopping optimistically short of filling the gap back to its close. Regardless, at least an eventual higher close is now required.
Gold Feb Contract (GC, ETF: (GLD))
Spiking up on payrolls to 1164.00 reacted down sharply into negative territory, its 1145.50 low stopping optimistically short of filling the gap back to Wednesday’s close before recovering back into the range.
Silver Mar Contract (SI, ETF: (SLV))
Spiking up on Friday’s payrolls was retraced as quickly to resume return to the 14.86 pullback limit that had held already Thursday, consolidating under it through the afternoon.
30-year Treasury Mar Contract (US, ETF: (TLT))
Spiking up to 163-22 on Friday’s payrolls remained encompassed by the prior surge, so it was only noise. But dropping to attack the 161-27 sell signal did react back up to attack the morning’s high.
Crude Oil Mar Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Higher highs overnight had evaporated before Friday’s open, replaced intraday by the relatively narrow directionless ranging as was expected.
Natural Gas Mar Contract (NG, ETF: (UNG, UNL))
Firming after Thursday’s reaction to fresh lows, a bottoming pattern has almost fully formed, but 2.02 must hold tests as support.
Look ahead: Economic Calendar – for Mon Feb 8, 2016
A midday look ahead in preparation for economic reports and events scheduled for the next trading day.
Highlights: No high-profile or influential reports are scheduled for Monday, as the reaction to Friday’s Employment report is more fully absorbed.
Labor Market Conditions Index
10:00 AM ET
3-Month Bill Auction
11:30 AM ET
6-Month Bill Auction
11:30 AM ET
TD Ameritrade IMX
12:30 PM ET
Daily Spot…
A daily summary of high-profile members of several complexes… View a more detailed discussion of each chart at the end of today’s Market Wrap.
Eurodollar Mar Contract (EC, ETF: (FXE, UUP))
Wednesday’s out-sized strength didn’t prevent gapping up again Thursday and extending even higher to confirm the breakout. At least an eventual third higher close is now likely.
Gold Feb Contract (GC, ETF: (GLD))
Gapping up Thursday didn’t trend much higher intraday, nor did it give back the opening gain, forming a potential Island. Gapping down back into Wednesday’s range — preferably under 1138.00 — would form the pattern, which would be likely to be retested.
Silver Mar Contract (SI, ETF: (SLV))
Thursday’s higher high tested 14.91 resistance without closing above it, so no higher targets are in-play. But momentum remains intact since the pullback limit held its test of 14.86.
30-year Treasury Mar Contract (US, ETF: (TLT))
Overnight weakness tested the 161-27 sell signal into Thursday’s open and firmed from there to continue ranging around the rally’s 162-26 target.
Crude Oil Mar Contract (CL, ETF: (USO, USL) (UWTI-long, DWTI-short))
Testing the 29.42 pullback limit by 2 cents snapped back to gap up Thursday, and a post-open dip also snapped up to 33.60. But the 32.50 bounce limit held through the close as was expected.
Natural Gas Mar Contract (NG, ETF: (UNG, UNL))
Greeting Thursday’s EIA report from a position of weakness allowed fresh lows for the move to form at 1.95. The pattern still has no buy signal, and its fresh low close doesn’t make a durable recovery yet likely.