Week Ahead Look: S&P 500, DXY

It's been a busy last few weekends for me.  Was glad to just chill and "re-orientate" myself with the charts and markets again.

Summer is upon us...


Rambling Sports Thoughts ...

I'm very glad to see a Heat / Thunder Finals.  I think everyone else is as well.  The Celtics would have been swept out the door.  I think the Heat have the speed to keep up with the Thunder and can match them talent wise if Wade and Bosh are going to be healthy.  I'll take the Heat in six games.

I was caught at my favorite dive bar last night watching the basketball game.  I had to pay a cover charge because they were airing the Pacquiao/Bradley fight.  So, I went ahead and watched the fight after the game.  Couple of things...I'm absolutely amazed that this shitty little bar I go to was PACKED for this fight....hundreds and hundreds of people willing to pay $10 to get in.  No wonder these guys like Mayweather/Pacquiao are still getting paid so much for the fights.  As far as the fight itself...it was utter bullshit.  I'm not a big "boxing" fan and now I remember why.  Pac-man clearly won the match...but lost?   Oh well...  Stay long Dana White and the UFC.

Nadal gets lucky with the rain delay....Novak "The Joker" Djokovic was going to cruise in the fourth set after beating Nadal in 8 straight games....ridiculous comeback going there.

Euro 2012...I like Germany to win it all.


SPX
Bearish long day. Midpoint above EMA(10). Tested and failed SMA(21,144). Holding above the 38.2% retrace (1296.82). No daily 3LB changes (reversal is 1332.42). Back below weekly 3LB mid. QE2infinity.



VIX
Bullish long day. Midpoint below EMA(10). Tested and held SMA(21). Tested and held its 38.2% minor retrace (21.62). No daily 3LB changes (reversal is 21.03).



EURUSD
Bearish long day (evening star confirmed). Midpoint above EMA(10). Tested and failed SMA(21). Holding above its 0.0% retrace (1.2363). No daily 3LB changes (reversal is 1.2368).



10YR YIELD
Bearish short day. Still failing all SMA's. Midpoint below EMA(10). Holding above its 0.0% retrace (14.67). No daily 3LB changes (reversal is 17.65).



WTI
BEARISH LONG day. Still failing all SMA's. Midpoint below EMA(10). Tested and failed its 38.2% minor retrace (85.75). New low on dally 3LB (reversal is 87.82).



HYG/LQD
Bearish engulfing day. Tested and failed SMA(21). Midpoint above EMA(10). Tested and failed its 50.0% minor retrace (0.7592). No daily 3LB changes (reversal is 0.7388).



"What a bailout really implies..."

26 comments:

Andy T said...

This Mauldin post is pretty sobering stuff...in re: Europe.

http://www.businessinsider.com/mauldin-a-dysfunctional-nation-2012-6

It really is untenable, isn't it?

I suppose it's the reason that gold and the dollar are going to rally in unison in the medium term.

AmenRa said...

Andy T

JPM predicted that the cost to Spain will be 350bn euros. RBS expects 450bn euros. Bondholders about to pick up the soap. Spain will be back for more in a few months. But how can Italy survive now that its contribution to EFSF/ESM has increased? Finland wants collateral. Germany still has not ratified the ESM (actually a few countries haven't).

Futures may have gapped higher but have been heading lower since.

AmenRa said...

Andy T

What are your thoughts on this: http://www.zerohedge.com/news/guest-post-it-only-took-global-depression-reduce-gas-prices-40-cents

He talks about how the US oil production is not as good as the MSM has been spouting recently.

AmenRa said...

10yr yield back to unchanged. EURUSD only +40pips to Fridays close. 10yr Spanish bond yields back over 6.42%.

AmenRa said...

10yr back under 1.6%...

AmenRa said...

Let the EU close shenanigans begin...

b22 said...

Nice gold charts AT, I agree with you, the triangle doesn't work well anymore, the legs dont' match, lesser degree wx, etc labels make sense to me

BinT said...

(RTTNews) - Final data released by Italy's statistical office Istat on Monday confirmed that the economy remained in recession in the first quarter of 2012 amid falling domestic demand and investment.

Italy's gross domestic product contracted 0.8 percent quarter-on-quarter in the first quarter of 2012 on a seasonally and calendar adjusted basis. This matched the preliminary estimate.

In the fourth quarter of 2011, the GDP was up 0.7 percent. The GDP has now fallen for three consecutive quarters.

The statistical office also revealed that the final consumption expenditure decreased 0.6 percent compared to the preceding quarter. Gross fixed capital formation fell 3.6 percent.

Reflecting weak domestic demand, imports decreased 3.6 percent from the previous three-month period. Exports dropped 0.6 percent.

The annual rate of contraction in GDP, meanwhile, was revised to 1.4 percent from the previously reported 1.3 percent decline.

...Yes. Goes without saying...

AmenRa said...

MUST...NOT...CLOSE...BELOW...THE...6/6/12...CLOSE...

AmenRa said...

Bailout half life now measured in hours. There goes any hope of keeping the market elevated before the election in Greece.

AmenRa said...

No Corner but added a few charts to the end of Andy's post.

AmenRa said...

Futures trying to keep hope up before the weekend election...

BinT said...

"The main fear is that Italy cannot grow its way out of a recession fast enough to pay a mountainous national debt. Other concerns include the fact that Italy, with the third-largest euro zone economy after those of Germany and France, will have to shoulder a large portion of the bailout bill even as it grapples with its own sharp economic downturn.

Because Italy does not have enough economic growth to generate the money itself, the government will probably have to borrow it at high interest rates, adding to an already heavy debt load.

“There is a permanent risk of contagion,” Mr. Monti told an economics conference near Venice over the weekend, speaking by telephone. “That is why strengthening the euro zone is of collective interest.”

Prices of Italy’s government bonds reached their lowest level in months. Investors apparently found little assurance that the euro currency union was any closer to solving its underlying problems — not with parliamentary elections in Greece this weekend that could determine whether the currency union is strong enough to retain its weakest members.

Investor euphoria in Europe over the Spanish bailout deal Monday morning was short-lived, giving way to an essentially flat day on many European stock markets. But Italy’s benchmark index was the Continent’s worst performer, ending down 2.8 percent.

Italian 10-year government bonds dropped in value for a fourth consecutive trading session. The yield — a measure of the government’s borrowing costs and of investors’ perception of risk — climbed 0.26 of a percentage point Monday to just over 6 percent. That is the highest level since January and a level that Italy could not afford for long.

The Spanish government’s 10-year bond yield also rose, closing up 0.30 of a percentage point, to 6.466 percent.

“There’s no doubt contagion will come to Italy,” Daniele Sottile, a managing partner at the financial advisers Vitale & Associati in Milan, said at the same conference, which was convened by the Council for the United States and Italy on an island near Venice. “It’s proof that the European mechanisms designed to stop the crisis are not working.”

http://www.nytimes.com/2012/06/12/business/global/monti-struggles-to-keep-italy-from-being-the-next-domino-to-fall.html?_r=2&ref=business

AmenRa said...

Futures only $2 above FV. Not exactly bullish but enough to kill put prices at the open before heading lower. Shrewd (or shady your pick).

AmenRa said...

Ruh roh. Spain 10yr now at 6.74%. Previous high was in Nov 2011 at 6.70%.

Italy OTOH now at 6.28% where its Nov 2011 high was 7.28%.

AmenRa said...

Spain 10yr 6.786%. Spain is not going to make it to the weekend before the 7.00% threshold is breached.

AmenRa said...

Update: Spain now 6.829%. TSHTF is in progress.

AmenRa said...

The kick save for the EU close in progress...

Andy T said...

can still make a case for the small scale inverted h&s bottom on the S&P500...actually looks more perfect now.

AmenRa said...

3yr results (prior is 5/8/12):

HY 0.387% prior 0.362%
B2C 3.53 prior 3.65
PD 60.91% prior 53.07%
DB 12.05% prior 11.24%
IB 27.05% prior 35.69%

AmenRa said...

Ok WTF was that move all about? From 13:11-13:13 the SPX jumped 4 handles.

AmenRa said...

I've seen days when the short squeeze is forced but c'mon man. I think what's frustrating to them is that the shorts are not biting and actually adding to positions. Which causes the algos to be set on "kill all stops on puts" mode.

Anyway, Spain 10yr still at Nov 2011 highs.

BinT said...

http://www.businessinsider.com/the-real-story-of-the-day-german-bonds-2012-6


But it's also possible that markets are starting to see German bonds -- as one twitterer put it -- as defacto Eurobonds.

If Germany is pot-commited to backstopping the debt of the entire Eurozone -- as hedge funder Mark Dow suggests -- then it stands to reason that Germany isn't the perfect risk-free credit that people assume. No matter how fiscally stable it is, Germany doesn't have its own printing press like the UK, Japan, and the US do.

AmenRa said...

"The bailout is not BS. Do not let the shorts or doubters get the upper hand. Smash them. This market will not under any circumstances be weak before this particular weekend. We are not prepared to do anything QE or otherwise so it's up to you."

From the throne of BB directed to the Group of 21 (aka Primary dealers)

AmenRa said...

For the record, since there was little movement in DXY or EURUSD I think todays move was BS. Stopped out...yes. But it's still BS. I'm starting to wonder if the Fed is the one selling USTs before the 10yr auction tomorrow.

AmenRa said...

Nuevo.

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