Welcome Stockaholics to the trading week of August 19th! This past week saw the following moves in the S&P: Major Indices End of Week: Major Futures Markets on Friday: Economic Calendar for the Week Ahead: Sector Performance WTD, MTD, YTD: What to Watch in the Week Ahead: Monday Deadline for temporary licenses for U.S. firms doing business with Huawei Tuesday 8:30 a.m. Philadelphia Fed nonmanufacturing 6:00 p.m. Fed Vice Chair Randal Quarles Wednesday 10:00 a.m. Existing home sales 2:00 p.m. FOMC minutes Thursday 8:30 a.m. Initial claims 9:45 a.m. Manufacturing PMI 9:45 a.m. Services PMI Friday 10:00 a.m. Fed Chairman Jerome Powell at Jackson Hole all times Eastern time
Bond Yields Plunge Most Since 'Black Monday', Stocks Stumble On Week This week was brought toy by the words "Distorted", "Different This Time", & "Resilient" and the number 800 (points down in the Dow)... China's National Team was very evident in their stock market this week (as economic data collapsed along with social order in Hong Kong) Source: Bloomberg Source: Bloomberg US equities staged a valiant recovery after the midweek collapse - following President Trump's call to the big bank CEOs...Trannies were the laggards as Nasdaq outperformed but all major US indices ended red on the week... Defensive stocks dominated cyclicals on the week... Source: Bloomberg VIX was up marginally on the week but ended back below 19... Source: Bloomberg Stocks and bonds decoupled as the former rallied back from near disaster and the latter ignored the propaganda... Source: Bloomberg A big week for bonds with 30Y Yields cratering over 25bps - the biggest weekly drop since June 2012... Source: Bloomberg 30Y yields fell to a record low, below 2.00%. And have collapsed 60bps in 3 weeks - the biggest crash in yields since August 2011's Black Monday following the US debt downgrade... Source: Bloomberg While 2s10s did invert briefly this week, it is the 3m-10Y that is more accurate and that remains deeply inverted... Source: Bloomberg Markets shifted to demand a more dovish Fed this week... Source: Bloomberg The dollar rallied on the week but remains below the post-Powell spike... Source: Bloomberg Yuan was stable for the rest of the week after spiking on tariff delays... Source: Bloomberg EM FX tumbled for the 5th week in a row... Source: Bloomberg Cryptos had a rough week... Source: Bloomberg But Bitcoin managed to get back above $10k... Source: Bloomberg Amid the chaos in bonds and stocks, commodities looked positively serene... Source: Bloomberg Aside from some chaos in crude... Yuan continues to devalue against gold... Source: Bloomberg Finally, as @LukeGromen noted so eloquently: "Have you ever seen people running into a burning building for safety? You have now." Source: Bloomberg Almost $17 trillion of negative-yielding debt globally! And a Hindenburg Omen hit stocks this week... Source: Bloomberg
Here are the percentage changes for the major indices for WTD, MTD, QTD & YTD in 2019- S&P sectors for the past week-
Down Friday/Down Monday Streak Ending: A Quick Recovery Still Needed Barring a late-day reversal, DJIA’s streak of Down Friday/Down Monday (DF/DM) will end today at two in a row. Recently we examined the record of past DF/DM occurrencesand noted that a quick DJIA recovery to pre-DF/DM levels was usually positive as it typically meant the worst of the decline was likely over. Today we delve deeper into the history of two or more DF/DMs in a row. Excluding the most recent occurrence, there have been two or more consecutive DF/DM’s 39 times since 2000. Of these 39, only four occurrences included three in a row. Using the last DF/DM of the streak as the starting point, the average decline from a subsequent high (within seven calendar days of Monday’s close) to the low sometime during the next 90 calendar days was 6.05% and all but three occurrences suffered a subsequent decline. Using Monday’s close as the refence point, the average decline was 4.53%. Only six of the 39 occurrences did not close lower than Monday’s close. The average number of calendar days until the low was reached was 45. \ Looking at the 30 trading days before and the 60 trading days after Monday’s close of the last DF/DM of the streak, the patterns are similar to single DF/DM occurrences. If DJIA did not make a quick recovery to pre-DF/DM levels, then DJIA tended to struggle and drift lower. Yield Curve Inversion Triggers Risk Aversion Unless you have been asleep for most of the day in preparation for an upcoming midnight shift, you have probably already heard, over and over, how the 10-year Treasury bond yield falling below the 2-year Treasury bond yield has a perfect record in recent years of forecasting a recession sometime in the future. The result was declines exceeding 3% by DJIA and NASDAQ. S&P 500 just missed this mark falling 2.9%. Since 1971, when NASDAQ began, this combination of losses or worse has only occurred 66 times prior to today. And of these 66 times, 25 occurred during the financial crisis bear in 2008 and early 2009. Plotting the 30 trading days before and 60 trading days after past occurrences reveals (top chart) initial steep and brisk declines followed by modest average gains over the following 60 trading days (approximately three calendar months). However, market performance did pick up nicely at the 6-month and 12-month later points and the frequency of gains also improved. The market could be in for more choppy trading especially in the often-turbulent months of August, September and October. Click here to view tables in a new window… As shown in the LPL Chart of the Day, the spread between the 2-year and 10-year Treasury yields fell as low as -2 basis points (-0.02%) in trading on August 14. Typically, yield curve inversion, when long-term yields fall below short-term yields, is viewed as a signal of oncoming recession, although often with a relatively long lead. In the past five economic expansions, the U.S. economy has peaked an average of 21 months after the spread between the 2-year and 10-year yields initially turned negative. U.S. Economy Remains on Solid Footing Even though we’re discouraged by the yield curve’s shape right now, we see few signs of danger ahead. Data shows the U.S. economy is on solid footing, and corporate debt spreads have remained contained in this latest bout of volatility. Financial conditions are still historically loose, yet there are few signs of excess in the financial system. U.S. stocks have also been resilient against yield curve inversions in the past: Historically, the S&P 500 Index has rallied an average of 22% from the first inversion to the eventual economic peak. “We’re not convinced that this yield curve inversion is a sign of imminent recession,” said LPL Research Chief Investment Strategist John Lynch. “The U.S. labor market is at full employment, healthy wage growth is fueling strong consumer activity, and corporate profits are at record levels.” Global Perspective Of course, recessions can be self-fulfilling prophecies of market sentiment, and we take that risk seriously. However, it’s a curious time for global fixed income right now, and Treasury yields have been weighed down by intense global buying pressure amid ultra-low sovereign debt yields elsewhere. Because of this, we think the yield curve’s shape has been driven more by technical factors than domestic economic weakness. Monetary Policy Remains Too Tight This yield curve inversion sends an important signal to Federal Reserve (Fed) policymakers. U.S. monetary policy is clearly still too tight, even after last month’s 25 basis point (0.25%) rate cut, given trade uncertainty and signs of slowing global growth. The Fed has promised flexibility, and we expect policymakers to enact one or two more cuts by the end of the year. Without an easier Fed, the U.S. dollar may stay elevated and global buying pressure will continue in Treasuries. What’s Next? We will continue to monitor the yield curve and incoming economic data. For now, we think the current U.S. economic expansion, now in its 11th year, has more room to run. A Closer Look at Technical Support Market Blog We continue to believe there is technical support for the S&P 500 Index as discussed in our August 9 blog, and we’re already seeing some signs of the pessimism that is necessary for forming a bottom. The negative sentiment intensified August 14 following the inversion of the yield curve (discussed in our August 14 blog), so today we want to take a closer look at some key levels the LPL Research team is watching. First is resistance, or levels that an index or stock may struggle to rise above. Despite Tuesday’s 1.5% gain, the S&P 500 ran right into its 50-day moving average near 2,940. This level also marked the 2018 highs for the market, adding to its significance. As for support, or levels at which we think buyers are likely to step into the market, there are three key levels we are watching: 2,822. The intraday low from August 5 is only about 1% below Wednesday’s close, but it may be viewed by short-term traders as a tactical way to gauge whether we have hit the bottom in this current pullback. 200-day moving average. Currently at 2,796, the 200-day moving average is a closely watched trend indicator that is commonly viewed as either support or resistance, depending on where the index sits in relation to it. 2,740. Perhaps the strongest level of support for the S&P 500 is 2,740. As seen in the LPL Research Chart of the Day, Key Levels for the S&P 500 Index, this benchmark has actually tested 2,740 two times so far this year, but it failed to close below that level either time. 2,740 also happens to be 9.5% below the July highs, right in line with a standard 10% correction. “We believe a retest of the December lows remains unlikely,” said LPL Chief Investment Strategist John Lynch. “We think any decline beyond 10% from recent highs would be excessive, and we would recommend that suitable investors rebalance and add to positions accordingly if the S&P 500 falls that far.”
Here are the current major indices pullback/correction levels from ATHs as of week ending 8.16.19- Here is also the pullback/correction levels from current prices- ...and here are the rally levels from current prices-
Stockaholics come join us on our stock market competitions for this upcoming trading week ahead!- ======================================================================================================== Stockaholics Daily Stock Pick Challenge & SPX Sentiment Poll for Monday (8/19) <-- click there to cast your daily market vote and stock pick! Stockaholics Weekly Stock Picking Contest & SPX Sentiment Poll (8/19-8/23) <-- click there to cast your weekly market vote and stock picks! Stockaholics Weekly T/A Charting Challenge (8/19-8/23) <-- click there to participate! ======================================================================================================== It would be pretty sweet to see some of you join us and participate on these! I hope you all have a fantastic weekend ahead!
Stock Market Analysis Video for August 16th, 2019 Video from AlphaTrends Brian Shannon ShadowTrader Video Weekly 8.18.19 Video from ShadowTrader Peter Reznicek
Here is a look at this upcoming week's Global Economic & Policy Calendar- (GLOBAL ECONOMIC AND POLICY CALENDAR NOT YET UP!)
Here are the most anticipated Earnings Releases for this upcoming trading week ahead. ***Check mark next to the stock symbols denotes confirmed earnings release date & time*** Monday 8.19.19 Before Market Open: Spoiler: CLICK HERE TO VIEW MONDAY'S AM EARNINGS TIMES & ESTIMATES! Monday 8.19.19 After Market Close: Spoiler: CLICK HERE TO VIEW MONDAY'S PM EARNINGS TIMES & ESTIMATES! Tuesday 8.20.19 Before Market Open: Spoiler: CLICK HERE TO VIEW TUESDAY'S AM EARNINGS TIMES & ESTIMATES! Tuesday 8.20.19 After Market Close: Spoiler: CLICK HERE TO VIEW TUESDAY'S PM EARNINGS TIMES & ESTIMATES! Wednesday 8.21.19 Before Market Open: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S AM EARNINGS TIMES & ESTIMATES! Wednesday 8.21.19 After Market Close: Spoiler: CLICK HERE TO VIEW WEDNESDAY'S PM EARNINGS TIMES & ESTIMATES! Thursday 8.22.19 Before Market Open: Spoiler: CLICK HERE TO VIEW THURSDAY'S AM EARNINGS TIMES & ESTIMATES! Thursday 8.22.19 After Market Close: Spoiler: CLICK HERE TO VIEW THURSDAY'S PM EARNINGS TIMES & ESTIMATES! Friday 8.23.19 Before Market Open: Spoiler: CLICK HERE TO VIEW FRIDAY'S AM EARNINGS TIMES & ESTIMATES! Friday 8.23.19 After Market Close: Spoiler: CLICK HERE TO VIEW FRIDAY'S PM EARNINGS TIMES & ESTIMATES! NONE.
And finally here is the most anticipated earnings calendar for this upcoming trading week ahead- ($BIDU $HD $CRM $TGT $EL $IQ $WB $KSS $LOW $SPLK $MDT $SINA $TJX $FL $SE $VMW $JWN $DKS $BJ $PDD $MSG $FN $KEYS $INTU $LB $ADI $JMIA $FLWS $ROST $RY $SNPS $CREE $URBN $PSTG $PINC $HRL $GPS $JKHY $HIBB $HPQ $LZB $TOL $SMED $PLCE) If you guys want to view the full earnings post please see this thread here- Most Anticipated Earnings Releases for the week beginning August 19th, 2019 <-- click there to view!
Looking at the VIX, I like to see a candle that goes up and reverses to close red, as the sign for end of the down move. Last week's VIX candle closed green. I'm thinking we could see this week start off with VIX shooting up.
I'm sure this ends well Denmark’s Jyske Bank JYSKY, -20.24%, is now offering a 10-year fixed-rate mortgage at negative 0.5%. Additionally, Finland-based Nordea Bank announced Wednesday that it will offer a 20-year fixed-rate mortgage in Denmark that charges no interest, and the bank is preparing for the possibility of home loans up to 30 years in duration having negative rates. Currently, the rates on 30-year fixed mortgages average just 0.5% in Denmark.
Published: Aug 19, 2019 3:38 a.m. ET Europe stocks on Monday advanced, as government officials across the globe discussed how the world economy could avoid a sharp downturn. After losing ground for three straight weeks, the Stoxx Europe 600 index SXXP, +0.84% rose 1% to 373.33, with the hard-hit banking sector SX7E, +1.20% leading the advance. The German DAX DAX, +1.04% climbed 1.23% to 11704.57, the U.K. FTSE 100 UKX, +0.90% increased 0.99% to 7187.72 and the French CAC 40 PX1, +0.79% increased 0.94% to 5350.71. U.S. stock futures ES00, +0.74% also were stronger. After a report from Spiegel last week that suggested Germany could deficit spend if it entered recession, Finance Minister Olaf Scholz over the weekend said the country has the strength to counter any economic crisis with “full force,” according to a Reuters report. The yield on the benchmark 10-year bund TMBMKDE-10Y, -5.66% edged up to -0.67%. Meanwhile, two White House aides over the weekend gave upbeat assessments of the global economy. https://www.marketwatch.com/story/a...ocks-start-higher-2019-08-19?siteid=rss&rss=1
Ok. I profit took on 70% of my long positions at 2930, all purchased at non-above 2900, including one lot at 2833
If the price collapses non-above 2900, I shall probably enter again long, especially if non-above 2850
