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12Oct2015 Market Update: WTI Oil Slipping Seriously, Averages Can't Advance Through Resistance, Investors Waiting For U.S. Banks Quarterly Results

Written by Gary

The averages traded well into the resistance this morning, but could not find enough bulls to push through this 'major' line in the sand. Some analysts say investors are waiting before a busy week of quarterly results from U.S. banks and several Dow 30 companies. But a slide in oil prices starting early this morning dragged down energy shares and keeping a lid on gains in other sectors.

Going into the afternoon session, oil is still declining in a big way which will assure the markets will not advance anymore today.


Here is the current market situation from CNN Money

North and South American markets are mixed. The Bovespa is higher by 0.47%, while the IPC is leading the S&P 500 lower. They are down 0.41% and 0.07% respectively.

Other analysts are wondering if we have seen the top of the channel and further declines are in order. Personally, I think it is way too soon to call anything one way or the other.

WTI oil is in the mid $47's seriously declining from Friday highs of $50.13 (Chart Here) and the U.S. Dollar is trading now in the high $94's, up from its low at $94.66 this morning (Chart Here).

Traders Corner - Health of the Market

Index Description Current Value
Investors.com Members Sentiment: % Bullish (the balance is Bearish) 66%
CNN's Fear & Greed Index Above 50 = greed, below 50 = fear 44%
Investors Intelligence sets the breath Above 50 bullish 38.3%
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.

88.73

StockChart.com NYSE % of stocks above 200 DMA Index ($NYA200R) $NYA200R chart below is the percentage of stocks above the 200 DMA and is always a good statistic to follow. It can depict a trend of declining equities which is always troubling, especially when it drops below 60% - 55%. Dropping below 40%-35% signals serious continuing weakness and falling averages. 31.02%
StockChart.com NYSE Bullish Percent Index ($BPNYA) Next stop down is ~57, then ~44, below that is where we will most likely see the markets crash. 45.11%
StockChart.com S&P 500 Bullish Percent Index ($BPSPX) In support zone and rising. ~62, ~57, ~45 at which the markets are in a full-blown correction. 50.60%
StockChart.com 10 Year Treasury Note Yield Index ($TNX) ten year note index value 20.90
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 77.95
StockChart.com NYSE Composite (Liquidity) Index ($NYA) Markets move inverse to institutional selling and this NYA Index is followed by Institutional Investors 10,347

What Is Moving the Markets

Here are the headlines moving the markets.

Oil slides on profit taking and as OPEC boosts output

NEW YORK (Reuters) - Oil prices tumbled on Monday, as traders took profits after last week's surge to an 11-week high, and on a report that OPEC continued to boost crude production despite a persistent glut.

AB InBev raises offer for SABMiller

LONDON/BRUSSELS (Reuters) - Anheuser-Busch InBev raised its proposed takeover offer for SABMiller on Monday, as the world's largest brewer tries to win over its smaller rival to the idea of creating a giant that would make nearly a third of the world's beer.

Dell to acquire EMC in $67 billion record tech deal

(Reuters) - Computer maker Dell Inc said on Monday it had agreed to buy data storage company EMC Corp in a $67 billion record technology deal that will unite two mature companies and create an enterprise technology powerhouse.

Facebook pushes shopping features in move to e-commerce

SAN FRANCISCO (Reuters) - Facebook Inc wants its users to shop for clothes and other products from their mobile phones without ever leaving its app.

Fed's Lockhart says 'lot more' economic data available in December

ORLANDO, Fla. (Reuters) - There could be sufficient economic data for the Federal Reserve to consider a rate hike at their meeting later in October but there will be a lot more data on hand in time for the December meeting, Atlanta Federal Reserve Bank President Dennis Lockhart said on Monday.

FTC review date for Staples-Office Depot deal extended

(Reuters) - Office supplies retailer Staples Inc has agreed with the Federal Trade Commission to extend the review period for its $6.3 billion takeover of Office Depot Inc .

VIX Drops For 10th Day In A Row, Breaks Significant Technical Support

For the first time since October 2010, VIX has fallen for 10 straight days (crashing from over 28 to under 17). The collapse in the 'fear' index has also broken it back below its 200-day moving-average for the first time since breaking above on August 19th.

Down 10th day in a row:

Breaking the 200DMA:

And after first decoupling after the August flash crash, then re-coupling two weeks ago, SPY-XIV has once again broken its historical relationship:

Note the recoupling lower in the SPY-XIV pair trade, just as we predicted on August 30 with our "no-brainer" trade idea.

XIV - ES: "no brainer" pair trade of the week pic.twitter.com/sAIanK2gMW

â€" zerohedge (@zerohedge) August 30, 2015

U.S. Stocks Higher, But Constrained by Energy Sector

U.S. stocks turned slightly higher on Monday but a slide in oil prices dragged down energy shares, keeping a lid on gains in other sectors.

Market Extra: Investors may call for more corporate breakups at industrial firms, says Jefferies

There has been a “strong trend†toward so-called demergers in U.S. industrial companies, and investors are beginning to ramp up the pressure for leaner operations at European companies, says Jefferies.

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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