Tuesday, September 6, 2016

Although the Fed desires to raise rates in their upcoming meeting, the data coming through is too conflicted to provide such a move. While the 30 day Fed Funds futures are pricing in about a 75% chance of a 25 basis point rate hike, the analysis from a TD viewpoint for the 10 year Treasuries and the US Dollar Index are not supporting such a move yet. However, that can all change if they trade above certain key levels between now and the September 21st meeting. Consider first the CBOE 10 year Treasury Index (TNX). It is currently bouncing off the lows, but until it breaks out above 1.739% or 17.39 TDST Resistance Level, rates should remain choppy or even head for one more lower low where we could see a major bottom in interest rates. Screen Shot 2016-09-04 at 9.20.29 PM

For the UD Dollar Index (DXY, a TD Sell Setup is in the works for the DXY. If it can consistently trade above the 96.129 TDST Resistance Level, that will suggest the US Dollar is in escape velocity mode. With TD Sell Setup @8, and bumping under the TDST level, it is probable it will fail. Screen Shot 2016-09-04 at 10.15.27 PM

Now for something a bit more actionable. If the Fed remains fractured, expect the SPDR Gold ETF (GLD) to continue higher if the active TD Sell Setup can maintain the count, and break out above the TDST Resistance Level at 128.22. With a solid gap after completing a TD Buy Setup @9, the chances that GLD can break above the TDST level looks good. Screen Shot 2016-09-05 at 8.21.32 PM

For equity markets, there are no significant updates as the benchmark S&P 500 (SPX) is still wavering. Once again, although equity markets are free to trade lower, there is room for another higher high. Details below.


S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: BULLISH

Neutral if SPX closes below 2168.50 on Tuesday, September 6, 2016.

Screen Shot 2016-09-05 at 8.31.15 PMEven though a 13 can be printed and aligned with the weekly, it is doing so under the context of a tight trading trade. Therefore any recorded TD Sell Countdown @13 won’t have much significance.


S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: NEUTRAL

Neutral until further notice

Screen Shot 2016-09-02 at 9.08.34 PMThis is still the primary timeframe we are focused on. Both TD Sell Countdown and TD Combo Sell are still on the 12 count. Similar to last week, both TD Sell Countdown and TD Combo Sell can record simultaneous 13’s if the week closes with a print higher than 2184.05 and a high equal to 2193.81 or higher. If successful, it will be tougher for the market to push higher.


S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH

Neutral if monthly SPX closes below 2096.96 on Friday, September 30, 2016. 

Screen Shot 2016-09-02 at 8.45.38 PMThe monthly SPX continues to roll despite the minor red candle last month. Any potential signs of trouble will be forewarned when a bearish price flip is recorded, similar to what happened on June 2015.


Advertisements
This entry was posted in Uncategorized. Bookmark the permalink.

2 Responses to Tuesday, September 6, 2016

  1. Gary says:

    Art, regards the 10-yr you wrote: Consider first the CBOE 10 year Treasury Index (TNX). It is currently bouncing off the lows, but until it breaks out above 1.739% or 17.39 TDST Resistance Level, rates should remain choppy or even head for one more lower low where we could see a major bottom in interest rates.

    We’re there now and I’m curious whether it happens to coincide with a TD Sell Setup count as well?
    Thanks –

    • Art says:

      As of the close yesterday, the daily TNX recorded a TD Sell Setup @4. It would be meaningful if the 10 year can close above 1.74% today.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s