Daily Forex Insight

Here are some insights from the currency strategists at dailyfx. They cover the fundamentals and technicals of key Forex pairs and other key markets along with some of the key economic news of the day. Today's commentary looks at the  S & P 500 post the payroll data out of the U.S:

Daily Forex Insight

Here are some insights from the currency strategists at dailyfx. They cover the fundamentals and technicals of key Forex pairs and other key markets along with some of the key economic news of the day. Today's commentary looks at the dramatic collapse in the Pound and the S & P 500 ahead of payroll data out of the U.S:

Daily Forex Insight

Here are some insights from the currency strategists at dailyfx. They cover the fundamentals and technicals of key Forex pairs and other key markets along with some of the key economic news of the day. Today's commentary looks at the Dollar, the S & P 500 and Gold:

Chart of the Week - Technicals of Key Indices

The chart of the week is courtesy Marty Chenard at stocktiming.com and takes a technical look at some key indices. While most indices are above key resistance levels going back to 2014 the broadest of them all the Nyse composite index (NYA) is still below key resistance levels. Will the NYA join the other indices or the other indices begin to roll over will be worth watching in the upcoming months.

Daily Forex Insight

Here are some insights from the currency strategists at dailyfx. They cover the fundamentals and technicals of key Forex pairs and other key markets along with some of the key economic news of the day. Today's commentary looks at possible range break outs in the Yen, Pound and the S & P 500:

Chart of the Week - Vix Futures CFTC Data

The chart of the week is courtesy the volatility surfer via seeking alpha and shows CFTC data on the Vix futures. Shorts on the Vix are at 10 year highs suggesting a high level of complacency in the market. This after the Vix has not made a new low on each of the recent new highs in the S and P 500 the last 2 years. Is volatility about to surge yet again in a seasonally week period for risk assets?

Daily Forex Insight

Here are some insights from the currency strategists at dailyfx. They cover the fundamentals and technicals of key Forex pairs and other key markets along with some of the key economic news of the day. Today's commentary looks at the dollar, the S & P 500 and the Pound:

Daily Forex Insight

Here are some insights from the currency strategists at dailyfx. They cover the fundamentals and technicals of key Forex pairs and other key markets along with some of the key economic news of the day. Today's commentary looks at the dollar and the S & P 500:

Chart of the Week - Libor Spikes Vs S & P 500

The chart of the week is courtesy Bob Hoye via SafeHaven and looks at spikes in the 3 month LIBOR rate vs S and P 500 performance. Any sustained spikes in LIBOR in excess of 25 basis points in the last year has often resulted in significant stock market pull backs as seen in August 2015 and February 2016. There is usually a lag of about 2 months for the sell off to occur. We had a recent LIBOR spike about 2 months ago and should see a stock market pull back soon. More importantly LIBOR has entered a clear uptrend this past year and that is problematic for risk assets long term:

S & P 500 Daily Outlook

Here is a daily view on the US stock market S and P 500 index from the analysts at Financial Doors. It covers the fundamentals and technicals of the S and P 500 index along with some of the key economic news of the day.

Chart of the Week - S & P 500 real sales growth

The chart of the week is via multpl.com and tracks real sales growth of the S & P 500 companies. Real sales growth as measured by the annual change in sales adjusted for inflation entered negative territory in 2015 and continues to remain so. The last time this occurred was in 2009. Will there be a similar price adjustment to reflect the declining fundamentals?

Daily Forex Insight

Here are some insights from the currency strategists at dailyfx. They cover the fundamentals and technicals of key Forex pairs and other key markets along with some of the key economic news of the day. Today's commentary looks at the S & P 500 and the Yen:

Chart of the Week - Cresmont P/E

The Chart of the week is courtesy Gary Gordon via seeking alpha  and shows the Cresmont P/E ratio of the S & P 500. The ratio is currently at well over 2 standard deviations over the mean much like in 1930, 2000, and 2008 when the market experienced substantial sell offs. Will it be any different this time around?

Chart of the Week - S & P 500 Seasonal Performance

The chart of the week is from Lance Roberts via seeking alpha and shows seasonal variations in S & P 500 performance since 1928. The period between August and October is the weakest period often generating
negative returns:

Some Developing Non Conformations in the Stock Market

With yet another Fed day arriving there are a number of non conformations in the market which have not matched recent highs in the stock market. Charts are courtesy nasdaq.com:


1) No new highs in the Transports in over 1.5 years:


2) The same holds for the Russel 2000 small cap Index:


 3) Financial stocks are lagging way behind:


4) Oil stocks are nowhere near their yearly highs:


5) Base metals like copper and related stocks are lagging way behind as well:


6) Last but not the least the CBOE Volatility Index the Vix (Chart from marketwatch.com) is yet to take out its yearly lows:

Chart of the Day - Growth in the S & P 500, P/E Ratio, Earnings

The chart of the day is courtesy the SRSrocco report and is a comparison of the increase in the S and P 500 and its P/E ratio since 2011 relative to its change in earnings.  A pretty big divergence is seen with earnings growth lagging far behind. Either the earnings growth has to catch up or prices have to come down in line with the sub par earnings growth observed.

Chart of the Day - Bear Market Probability

The chart of the day is courtesy of Econmatters that shows bear market probabilities for the US stock market S & P 500 Index. The chart shows that despite the recent rally, the probability of a bear market is still pretty high:

Dollar Strength to Return?

Yet another FED day has come and gone, the dollar has been trending down and is approaching oversold levels and could trigger a risk off trade near term, here's how to play this:

1) Dollar Strength:

The dollar is oversold and is likely to bounce from oversold levels and strengthen against the Euro: 

Can play this via the Ultralong Dollar ETF UUP: 

 2) This should trigger a selloff in commodities like gold, oil and base metals which are overbought: 

Can play this via the ultra short basic materials ETF SMN: 

 3) The Volatility picture remains complacent suggesting a surge in volatility post the fed. 

Can play it via the ultra long ETF on volatility UVXY: 

 4) This could trigger a selloff in stocks, with the S & P 500 breaking down out of a massive rising wedge on the long term charts courtesy stocktwits.com: 

 Can play this via ultra short ETF’s

5) Collapsing High Yield:

A high yield collapse is just around the corner and can be played via the ultra short ETF SJB:

All is not Well with Global Financial Markets

It does appear that all is not as rosy as it used to be in the global financial market landscape:

First and foremost global shipping activity appears to have come to a screeching halt, as pointed out by Jeff Berwick via the Market Oracle and this likely has recessionary implications:

Secondly when a single bank's derivative exposure exceeds the GDP of a country or region you know you are bound to have problems as ETF daily news rightly points out the case of Deutsche Bank:

Thirdly as QuandaryFX points out via Seeking Alpha the S & P 500 starts turning down when manufacturing starts to turn down like we are seeing off late:

Last but not the least the Safehaven plunge into Gold,Treasuries & the Japanese yen is clearly taking hold as pointed out by Chris Vermeulen via CNA Finance:

Interesting Market News and Views from Global Financial Markets-15

1) Dudley's Dovish Declaration Develops into a Deluge of Dollar Disposal

From www.fxstreet.com - Today, 10:05 PM

It’s been a disastrous day for the world’s reserve currency: the US Dollar Index is trading down by over 1.5% to a new 3-month low near 97.00 and the greenback is falling against every one of her major rivals.

2) Budget to Decide Market Direction: Ramesh Damani - NDTV

From profit.ndtv.com - Today, 10:03 PM

Ramesh Damani, member of the Bombay Stock Exchange (BSE), expects the upcoming union budget to decide the fate of stock markets in the medium term.

3) Wednesday Report... Inflection Points Galore | Rambus Chartology | Safehaven.com

From safehaven.com - Today, 10:02 PM

There is alot of action going on this week in all the different areas of the markets. The PM complex has been rallying, the US dollar tanking today and the stock markets trying to make up their mind which way they want to go ...

4) (DJI), SPDR Dow Jones Industrial Average ETF (ETF:DIA) - The Dow Just Did Something It's Only Done 17 Times In 70 Years

From www.benzinga.com - February 3, 8:52 PM

The Dow Jones Industrial Average just alternated 1% moves up and down for 4 days in a row – just the 17th such stretch in the last 70 years. The stock ...

5) The Next Generational Bust Is Coming, Stock Market 70% Collapse :: The Market Oracle :: Financial Markets Analysis & Forecasting Free Website

From www.marketoracle.co.uk - February 3, 8:51 PM

The Next Generational Bust Is Coming, Stock Market 70% Collapse :: The Market Oracle :: Financial Markets Analysis & Forecasting Free Website

6) Short term rally over, not ruling out a 1000 point decline in Nifty | Aditya Trading Solutions | ATS Research | Equity Indices | Nifty | Indian Stock Markets - Aditya Trading Solutions : IndiaNotes...

From www.indianotes.com - February 3, 7:29 PM

On 01 Feb'16, market made a high of 7600.45 & on the consecutive days, we have been seeing continuous weakness.