Total market view

7/8/2018 Total market view: "The second half is starting with a risk on move. There were a lot of potential buys in the last week and here's the key thing - not much is at resistance yet. Only IWM has reached a JulR1, even 2 hour charts are not overbought on RSI yet, and indexes have room to hit most Bollinger bands (Q, M, W, D). This means a lot of indexes are set up for a decent move higher."

Result - Most USA indexes except RUT higher last week.

Last week DJI and NYA joined RUT, NDX and SPX above all long & medium term pivots (disregarding weekly & daily pivots for this type of basic status). So bulls have the ball. RSIs on daily and weekly charts are not overbought, so room to move higher in that regard. Valuations per SPX forward P/E still in 16s so even a tag of 17X again would push to 2850+. Sentiment per daily put-call is skeptical. New lows plunged last week, the opposite of what we would be seeing if this rally was about to stall. 

Simply stated most evidence supports the bullish case. OK, 2 hour charts are overbought. Financials are weak and TLT remains stubbornly strong. It is summer and SPX stalled in this 2790-2800 several times this year. If DJI and NYA were below 2HPs I would be sounding more cautious. But with all 5 indexes moving together, it is easy to prefer the bull side.

In the move off the lows, IWM was the first main index to recapture above all pivots. SPY and IWM quickly followed. Among the indexes I track, XBI was actually first, above all pivots on 7/3 and then clearing above all MAs on 7/5. These were core longs. 

In last week's Total market view I mentioned several additional good looking buy setups: XLF was set to bounce off its YP and it did in a big way, until a quick fade. XLE launched then dropped just as fast. INDA had a nice move up. Only SMH didn't work but if already long XBI and QQQ no real need to pile in huge on the tech laggard. So the core longs are still doing fine (thought bit concerned about IWM), the extra setups were mixed.

Bottom line - Although the next move up may take a bit more work than the last two weeks, I think SPX is heading to major resistance at 2820-30 and pulling for NDX to reach 7460 - 7570. I am less sure what happens to RUT as that has failed twice on its YR2. I'll keep to this bullish case especially with all 5 main indexes above all pivots. 

USA main indexes - more detail here.

Sectors of note - XLF weak below HP and finished the week slightly under QP. XLE topped on JulR1 with YR1 just above so no bias to next move there.

Developed - Nikkei improving also above all pivots as of 7/13. DAX struggling, below YP.

Emerging - China starting to stabilize. INDA was a nice pick last week, but still under HP. If EEM and FXI can reclaim YPs then that further supports the basic bull idea.

Safe havens - VIX testing YP with a fractional close below the level on Friday. Any move up could be another hedge idea if other bearish events. TLT the outlier safe haven. Metals terrible.

Commodities - Turned out I didn't miss much in oil as drop came rather suddenly not from any pivot level. Pesky when that happens. Still above all pivots, but prefer to go with indexes that are starting 2H by moving up not with a semi-crash.

Currencies - DXY still under YP. 

Cryptos - BTCUSD really slowing down but if it can't get moving with tech flying higher then probably going lower. Core target 3-4K, possible 4800.

New lows making it more likely current stock rally will continue. 

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SPX could easily reach 17X again (green line) currently near 2850 and still rising. 

Put-call still on the high side. Next week monthly options expire. SPX 2825 anyone?

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July dates
7/3 - Stock index pullback low
7/10-11 - Actually looks like pullback low on 7/11