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09Oct2015 Market Update: Markets Making Wide Swings, Flat, Mixed And Sinking, Very Low Volume, WTI Trading At High 49 Level, But Sliding

Written by Gary

Markets opened higher, but have spent the morning session trading in wide swings on very low volume suggesting HFT manipulation. The U.S dollar is falling to a support set last month and gold is rising to a resistance set in August, 2015. Markets are mostly flat and mixed looking like we will see all of today's gains erased by the close.


Here is the current market situation from CNN Money

North and South American markets are mixed. The IPC is higher by 0.64%, while the Bovespa is leading the S&P 500 lower. They are down 0.41% and 0.10% respectively.

Short-term indicators are swinging back and forth across the neutral line while the averages are flirting with a significant resistance and as of now do not appear to be closing above that line. Several analysts are calling for a reversal now that the SP500 has rejected the ~2020 resistance.

DOW trades at huge August breakdown level ahead of S&P...

Signs of stocks turning lower will put us in 'hit-the-bid' mode.

The FOMC day spike at 2021 is now in play. The parallels we were watching are busted. The top of the break provides very minor support at this time. We are by no means inclined to buy into these levels, and in fact on reversal alert, but do wonder if it won't be until the big breakdown level at 2040 [on the SP500] before this rally ceases, at least for a little while.

Traders Corner - Health of the Market

Index Description Current Value
Investors.com Members Sentiment: % Bullish (the balance is Bearish) 65%
CNN's Fear & Greed Index Above 50 = greed, below 50 = fear NR
Investors Intelligence sets the breath Above 50 bullish 35.7%
StockChart.com Overbought / Oversold Index ($NYMO) anything below -30 / -40 is a concern of going deeper. Oversold conditions on the NYSE McClellan Oscillator usually bounce back at anything over -50 and reverse after reaching +40 oversold.

95.45

StockChart.com NYSE % of stocks above 200 DMA Index ($NYA200R) $NYA200R chart below is the percentage of stocks above the 200 DMA and is always a good statistic to follow. It can depict a trend of declining equities which is always troubling, especially when it drops below 60% - 55%. Dropping below 40%-35% signals serious continuing weakness and falling averages. 30.89%
StockChart.com NYSE Bullish Percent Index ($BPNYA) Next stop down is ~57, then ~44, below that is where we will most likely see the markets crash. 43.97%
StockChart.com S&P 500 Bullish Percent Index ($BPSPX) In support zone and rising. ~62, ~57, ~45 at which the markets are in a full-blown correction. 49.60%
StockChart.com 10 Year Treasury Note Yield Index ($TNX) ten year note index value 20.97
StockChart.com Consumer Discretionary ETF (XLY) As long as the consumer discretionary holds above [66.88], all things being equal, it is a good sign for stocks and the U.S. economy 77.44
StockChart.com NYSE Composite (Liquidity) Index ($NYA) Markets move inverse to institutional selling and this NYA Index is followed by Institutional Investors 10,342

What Is Moving the Markets

Here are the headlines moving the markets.

StanChart chief plans to cut about 1,000 top staff: memo

SINGAPORE/LONDON (Reuters) - Standard Chartered's new Chief Executive Bill Winters plans to cut about 1,000 of the bank's most senior staff to reduce costs, according to a memo sent to staff, as he battles to revive the bank following a sharp drop in profits.

U.S. import prices point to smaller drag on inflation

WASHINGTON (Reuters) - U.S. import prices fell only slightly in September, offset by recovering oil prices, suggesting a slowdown in the rate of imported deflation is occurring which may eventually allow the Federal Reserve to raise interest rates.

Sturdy quarter likely for financials, but ETF investors cautious

NEW YORK (Reuters) - The financial sector is expected to be a bright spot for U.S. earnings growth in the third quarter, but options traders are playing it safe by snapping up protection against any surprises.

China concerns leave central banks in difficult spot

LONDON (Reuters) - The coming week will provide clues on whether the global economy is escaping from its lackluster growth rut, amid growing concerns of another downturn which central banks have few tools left to fight.

Fed's Lockhart still sees 2015 rate hike despite recent red flags

NEW YORK (Reuters) - A U.S. interest rate hike is still probably coming in October or December despite some conflicting economic signals, a top Federal Reserve official said on Friday, reinforcing the central bank's message over the last few weeks.

Economists Finally Admit, Odds Of A US Recession Are On The Rise

As the evidence, that the US economy is either in or near a recession, mounts (confirmed by a new cycle high in inventories-to-sales just today), it appears even the most ardent optimists are admitting the odds of a US recession are on the rise. As Bloomberg reports, for the first time in 14 months, economists year-ahead recession probability estimates rose (to their highest level in 2 years).

Whether it is the "facts"...

Such as all 6 regional Fed surveys flashing red...

Or Wholesale inventory-to-sales at cycle highs...

< ...

Why Are The IMF, The UN, The BIS And Citi All Warning That An Economic Crisis Could Be Imminent?

Submitted by Michael Snyder via The Economic Collapse blog,

The warnings are getting louder. Is anybody listening? For months, I have been documenting on my website how the global financial system is absolutely primed for a crisis, and now some of the most important financial institutions in the entire world are warning about the exact same thing. For example, this week I was stunned to see that the Telegraph had published an article with the following ominous headline: "$3 trillion corporate credit crunch looms as debtors face day of reckoning, says IMF". And actually what we are heading for would more accurately be described as a "credit freeze" or a "credit panic", but a "credit crunch" will definitely work for now. The IMF is warning that the "dangerous over-leveraging" that we have been witnessing "threatens to unleash a wave of defaults" all across the globe...

Governments and central banks risk tipping the world into a fresh financial crisis, the International Monetary Fund has warned, ...

Happy Days Are Not Here Again

Via EconomicNoise.com,

The Dow-Jones Industrial average closed over 17,000 today, for the first time since August. Do not misinterpret this recent rise. Happy Days are not here again.

potemkinvillage

The Fed is stymied in the near-term. It would like to raise interest rates but just the threat of that happening (or the notion that they will not do so) is enough to produce disproportionate reactions in financial asset prices. There are many who believe that a bullet has been dodged and that markets are now safe to re-enter. Maybe, but probably not. As pointed out in an earlier post:

The strength of an economy creates wealth. Without a strong economy no nation grows wealthy or stays wealthy. Asset valuations are ultimately grounded in the economy, at least in the long run. Rising employment, standards of living and financial asset prices accompany strong economies. Without these pre-requisites, long-term wealth cannot be created.

Our economy is weak, not strong. It has been exhausted by massive government and its idiotic policies. True wealth is not created or expanded under these circumstances. Wealth and the standard of living are shrinking. Wealth may be shifting hands from one group of people to another, but it is not growing. Nor can it until government is stripped of much of its size, power and regulatory excesses.

Whether markets continue to recover ( ...

02 October 2015: ECRI's WLI Growth Index Improves But Remains In Contraction

ECRI's WLI Growth Index which forecasts economic growth six months forward - again improved but remains in negative territory. This index had spent 28 weeks in negative territory then 15 weeks in positive territory - and now is in its eighth week in negative territory.

Deutsche Bank writes off $6.6 billion for ancient acquisitions

Deutsche Bank says threat of higher capital requirements for investment banking and trading units means premium paid for Bankers Trust and Postbank is worthless

Earnings Outlook: What to look for in Netflix's earnings

The streaming giant is pushing further into the content space, competing for programming and films, and continues to advance its 200-country expansion plan by the end of 2016.

The Fed: Fed's Dudley sounds skeptical about October interest-rate hike

William Dudley, the influential president of the New York Fed, sounded skeptical of an October rate hike on Friday.

Earnings Summary for Today

Earnings Calendar provided by Investing.com.

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To contact me with questions, comments or constructive criticism is always encouraged and appreciated:

gary@econintersect.com

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