1/7/15…are we having fun yet?

Quote of the Day from the Friars Club Encyclopedia of Jokes: “Dyslectics of the world, untie! – anon

Bloomberg Quote of the Day: “In great attempts it is glorious even to fail.- Vince Lombardi: did he REALLY say that?…even after a loss like the Bengals had? …tell that to them! …especially when the ref made the worst call of the year! TB

Changes: news section has been eliminated; ALL overnight markets are now at the TOP of the report, followed by the Market Summary from the prior trading day. This should make it easier to get a quick update on the market. Hope this meets with your approval…if not, deal with it! Comments appreciated. TB
(CORRECTION: Previously TB reported that stocks (SPX) would have eight straight years IF the go higher in 2015, a record. They have had SIX straight which is the record, so one more would make it SEVEN. Note also that of the six, 2010 & 2011 were only minor gains! 7Previous record was 1994-1999 – five which ended with a bang in 2000!)

Overnight Global Markets:
European equity markets in at least a ‘dead cat bounce; Asia not so much (note Nikkei over past 7 sessions – conflicted!): UK +1.2% vs -0.3% vs -1.5% vs -0.2% vs +0.3% vs -1.1%; France +1.2% vs +0.4% vs -2.6% vs -0.3% vs +0.6% vs -1.2%; Germany +1.2% vs +0.9% vs -2.3% vs -0.6% vs closed vs -1.2%; Japan FLAT vs -3%!!! vs -0.2% vs closed 2 days vs -1.6%! Hang Seng +0.8% vs -1%! vs -0.6% vs +1.1%! vs +0.4% vs -1.1% vs +1.8%; Korea +0.1% vs -1.7%!!! vs.-0.6% vs +0.6% vs closed vs -0.6% vs -1%; India -0.3% vs -3%!!! vs -0.2% vs +1.4%!!! vs +0.4%. U.S. equity futures attempting a recovery – near session highs…will it hold? DOW +144!!! (range 126 plus 21 gap!); SPX +17 vs -37 (18 +1); NDQ +28 (30 +5). U.S. markets opening in line. Watch for major resistance at the 40/50 m/a’s!

Global Money Markets: Libor: 0.254% 3 mos.; 0.362% 6 mos., a tad better – still not that far off their recent record lows! The Fed Funds rate has averaged 0.09% and is now 0.12-0.13% – 0.14% remains the 9-month high. T-Bills: +0.01%, one-month; 0.03%, 3 mos; 0.25% – back at the recent high!

Bonds: After closing strong at new 12-month low yields, Treasuries are taking a breather overnight: 10’s 1.98% -5/16; 30’s 2.54% -7/8; Long TIP: 0.70% -1-1/16. Still only about half of Tuesday’s gains…keep the faith!

European Bonds: slightly higher yields – led by GREECE – note all others hit new 12-month lows yesterday (Benchmark is 10yr): Germany 0.46% +2; UK 1.61% +5; France 0.75% +3; Italy 1.88% +10!; Spain 1.66% +3; Portugal 2.64% +8!; Greece 10.26%!!! vs 9.43 +78!!!; look at the last 16 days range: 7.03% to 10.26%!!! 10/16’s close was 8.54%! – cycle low: 5.42%; Crisis high: 12.57%. Japan: 0.28%! –.

Dollar: slightly higher again and continuing to gain against the Euro: $1.1820 overnight low…lowest since 6/10/2010!!!; Sterling $1.50.91!!!, lowest since 8/13!; Yen slightly better for a 2nd day at 119.41, still close to the 12/8/14 low.
Commodities: Gold in an inside session and also taking a breather ($1212.00 -$7.40), Silver still holding in 16’s, currently $16.38; Crude hit yet another low and new handle at $46.83! Currently $48.28 +.36, don’t be fooled…this is merely a rest stop – caution!

Tuesday’s Market Summary:

…even worser! Both Dow Transports and the Russell 2000 lost 1.7%! The two Nasdaqs -1.3%! S&P 500 -0.9% and the Dow -0.7%. Once again, Dow Utilities bucked the trend” +0.2%. Now look at Volume a huge 4.44B shares. There was an ‘attempt’, albeit feeble to rally the market but it failed after just one hour – the session high! Then down to the lows, a failed attempt to get back to even and then back down, but at least SPX didn’t close below 2000…nope, 2002! The Russell 2000 was the last to capitulate managing to close at the 40 day and a tad above the 200 day, but it was for naught as it plunged almost to the 200 day today. This is not a joke…it’s got legs…weak at the knees legs!
A/D’s and Breadth were deeply negative again while new 52 week highs rose by 50% but just to 206 or about average while new lows bested it at 223 – also a 50% increase! Then came the VIX: 21.12 +1.20 with a range of 19.52-22.90! The highest high since 12/17 and close since 10/17!!! Definitely deep in bear territory! Batten down the hatches! Dive!

A/D’s and Breadth were even to slightly positive on the NYSE but slightly negative on Nasdaq! New 52 week highs were halved to a weak 148 while new lows dropped to 58 – it appears the players are already setting up for options expiration on the 16th! The VIX which closed Friday at an extremely high 19.20, came in but remains high and bearish at 17.79! Caution! Little to report on the indices: Dow Utilities were once again the best performer at +0.6% while the biggest losers were Dow Transports and the Russell 2000, both down 0.5%. The rest barely (bearly?) budged at -0.2% to +0.1%.

Bonds rallied sharply to new 12 month lows, while Crude continued its plunge hitting $49.68 before closing just below $50. Gold took off again continuing to produce ranges of $13-22 and close above $1200 for only the first time since 12/3! Dollar remains strong while the Euro continues to sink, now $1.19. Note: 2014 was the BEST YEAR for bonds since 2002…it was a very good year…but 2015?

Total NYSE Volume soared to 4.44B shares, a second day of rising volume while stocks tanked. This vs 3.77B vs a weak 2.7B vs 2.55B vs 2.42B – 12/24’s 12-month low was 1.4B shares. Shares traded on the NYSE floor rose to 942M, highest since 12/19 vs 845M shares vs 646M vs 670M vs 539M – 12/24’s 349M was the 12-month low…average is 733M shares! Two 800M+ days back-to-back…both down!

A/D’s were negative for a 2nd session: NYSE: -2x vs -3.3x! vs +1.2x vs -2.2x vs -1.4x; Nasdaq -3.2x! vs -2.4x vs -1.3x vs -1.3x vs -1.6x; Breadth was similar: NYSE -2.5x vs -7.3x!!! vs 1:1 vs -3x! vs -1.6x; Nasdaq -3.3x! vs -4x!!! vs -1.3x vs -2x vs -1.7x. New 52 Week Highs rose by 50% to 206 vs 144 vs 148 vs 321 vs 257 vs 414 – their range for the last 12 mos. is 39-612!!! New Lows also rose 50% to 223 vs 143 vs 52 vs 88 vs 95 (12/16’s high was 712!!!) The 2014 range is 24-1043!!! S&P VIX exploded again to the upside with a range of 19.52-22.90!!! before settling at 21.12 +1.20. Since 12/24 it has risen 39% but the bulls persist…why???? Making another run at 12/16’s high of 25.20, which was highest since 10/17! We remain at risk of those bearish extremes that had a high of 31.06 (highest since 11/28/11!!!). The average of the past 12 months is 14.24 slowly and steadily climbing, with a low of 10.28!…high close was 26.25 on 10/15/14!

U.S. Bond market closed STRONG for a SEVENTH straight session and for a 2nd day took out the 12-month low yields…look: 10’s 1.94!!! +13/16; 30’s 2.50%!!! +2-1/8 and long TIP 0.66%!!! +1-3/16…unbelievable!
Libor: 0.256% 3 mos.; 0.365% 6 mos. Steady and still not that far off their recent record lows! The Fed Funds rate has averaged 0.09% and is now 0.13-0.14% – 0.14% remains the 9-month high. T-Bills: +0.01%, one-month; 0.01%, 3 mos; 0.22% – 0.25% is recent high!
European Bonds also STRONG – to new 12-month lows, PIIGS rebounding from weakness Monday, ex-GREECE (Benchmark is 10yr): Germany 0.44%!!! -7!; UK 1.58%!!! -8!; France 0.72%!!! -8!; Italy 1.78% -5; Spain 1.56% -5; Portugal 2.50% +1; Greece 9.43 +7; look at the last 15 days range: 7.03% to 9.32!!! 10/16’s close was 8.54%! – cycle low: 5.42%; Crisis high: 12.57%. Japan: 0.28%!!! -4.

Gold traded in a range of $1204.00-$1223.70 following a positive key reversal…and this time the close was highest since 10/29 and also the first time since then without a print below $1200! It closed at $1219.40 +$15.40. It is no longer weak, making $1200 major psychological SUPPORT again, as well as the 40/50 day! $1238 is next resistance.Since 12/23 it has had a range between $13 and $21 every day, now with a bias to the upside! 12/22’s low was $1172.20, lowest since 12/1! 11/7’s low was $1130.40, the current 12-month low! 42 of the last 44 sessions with prints below $1200. Last close above $1300 was on 8/15. 7/17’s session high was $1346.60, highest since March 19th!!! MAJOR SUP now at the 40 day $1194, and the 50 day $1193, with major res at the 200 day $1258. The 12-month high is $1392.60 on 3/17, highest high since 9/4/13. 11/7’s low was $1130.40! Silver too traded above $16 with a high of $16.58, highest since 12/16, that following its $17.27 high on 12/9. $14.12 is the recent low, not seen in more than five years!

Crude struck its SIXTH straight new low with a $47.81 print, still lowest since 4/30/09!!!, closing very weak at $47.93 -$2.11 – nearly $5 in two days! 8 days ago the high was $58.91 Consider: 10/25’s high was $84.83. There have now been 60!!! handles since peaking at $107.73 on June 13th, highest since 9/19/13, and if off 54% since then! The record high of $147.27 was on 9/30/08, the low since on 4/30/09 is $51.94: $84.15 is the average! Recent rally high and close are $110.70 and $110.53 respectively. RES at the 40 day ($63.80!!!), then the 50 day ($66.99!!!), and lastly the 200 day ($90.50) – all continuing to plunge! It cut through $50 like buttah and all bets on a rally are off the table…how low can it go? The recent range is now $47.84-$112.24 since 3/1/12. Note that following the financial crisis it traded down to $32.40 on 12/31/08 from a high of $147.27 just three months earlier (-78%!!!).

Note: TB’s new wine blog is now posted at traderbillonwine.com

Have a great day!

TB

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