4/29/20 MARKET CLOSE Update - Consolidated Analysis

This is my singular thread that encompasses all areas of review for the day in the market.

QUICK SUMMARY:


System Update Note: We added the 'Adjusted GEX' in there today. This measures the Delta Skew and accounts for it between Puts/Calls. It gives you an even more emphasized figure to run with. We will have all of the inner-workings of that formula in our white paper that we will publish on our website next month with our app. You will see this appear on the GEX images above the Raw GEX figure.


"Whatever it Takes" Jay Day:


  • Volatility used and thrown away like a dirty napkin VIX -6.97% and VXX -7.96% (down 25% in a week)

  • UUP was bid on the weakness and still range bound at higher levels in the box.

  • The Ketchup Team (IWM/XLF/XHB/XRT) blew it out again...most shorted became biggest winners 3 straight days.

  • SPY was bid up 1.5% overnight...ground hog day...up 3.5% here AH as I write this

  • Oil rewarding Robinhood USO dip buyers.

  • Semiconductors took out the MSL and are now neutral..beast mode

  • Tech was strong and the FB reported good earnings and they were up 18% AH and drug the whole index up...now it is in the nosebleed so let's just gun for new ATH right?!

  • HYG strong day and bounced up almost 1%.

  • DIA gave it the old college try to get up and through the bullish trend channel from before - stalled at the channel.

  • FAANGs were up today with GOOG and FB both plus 10% - blow out upside AH moves.

  • Internals are burning the bears alive now...scorched earth and bear skin rugs.

  • Absolute Breadth still the only fly in the ointment at the moment for bulls.


Another overnight 2-3% up session that dragged the indexes higher and higher into the FOMC announcement. Announcement no one liked. Jay Powell's zoom meeting everyone liked...and his dedication to the indexes (yeah just fuck the rest of the US citizens - they are Congress/Senate's problem was his answer) was unquestioned which led to more rallying afterwards. We will use 'everything within our power' with 'aggression' and 'we are here to win'. Many very bizarre comments today from him that have no place in monetary policy like 'now is not a time to worry about Moral Hazard'. WTF? Can this get every index up into a new bull market (albeit it would be the ultimate Jay-Bull b/c there is nothing economically bullish about 3-4/10 US citizens unemployed and negative oil prices)?...Idk but...time will tell.


VIX was clubbed again. I pictured VIX and VXX like Joe Pesci and his brother in Casino taken out to the corn fields...yeah like that. Both are on life support (but still not dead) I came to their rescue at the lows along with few other VIX gangsters before they were put in the pine box.


Facebook and Microsoft blew out earnings (most commentators cited that the quarter was great but that is the quarter before COVID-19 but who the fuck cares right b/c the market is forward looking right?...CNBC is such a clown show) and so QQQ and SPY just went on a rampage post 4PM. This can carry over into tomorrow.


Banks are the last ugly left behind step child who needs a FVG gap fill toy so I suspect they get to go shopping at Jay's-R-Us tomorrow and pick some price levels out above.


Tomorrow we have AMZN and AAPL. But in reality there is very little bearish scent to the market left...almost everything that I mentioned last 10 days that bulls needed to do (even the tall order ones) have been done. Is that a good thing or a bad thing and can it persist or was that it? Those questions I do not have the answer to...but now everything is bent up in termination structures...as I have warned - they can persist for a long time but always and flawlessly bring ugliness when done.

SECTORS:

Sector Takeways: Whatever it takes means - all green all day. I mean why not Nat Gas too...why can't you all just by Nat Gas too - just direct off the exchange...I mean store it there at the Eccles Building in the basement. Don't be a punk Jay...just by NG futures...c'mon.

VOLATILITY:


VIX: Chart with Detailed Levels

Market Structure: Bullish

Momentum: Reset - Neutral

Internals: N/A

Block Volume: N/A


VXX: Chart with Detailed Levels

Market Structure: Bullish

Momentum: Bearish

Internals: Negative

Block Volume: Positive

GEX: Negative


VIX/VXX Summary: My comments from above carry forward here. The 30 level is in trouble for VIX and then that leaves the 25 level as last support level before we are in equity nirvana = (low VIX/high positive GEX). Will we get equity nirvana again?

INTERNALS


TRIN:

Takeaway: Neutral action for the most part. Not usable in this environment like today. IWM was relatively weak latter part of the session...could be nothing could be something.


ADVANCERS/DECLINERS:

Takeaway: All bulls all day. Some neutral players...that is new.


NYSE ADVANCERS/DECLINERS:

Takeaway: Bulls going for the gold tomorrow - trying to flip that MSL and turn the structure bullish.


CUMULATIVE VOLUME:

Takeaway: Same as Advance Decline...trying to turn the structure bullish here...should have a shot at it tomorrow.


ABSOLUTE BREADTH:

Takeaway: MONITOR. Only thing standing in the bulls way. This is reading exactly like the reading from week of Feb 24-28 last time the world was perfectly priced. See if there is any relation or if this is just a miss here for AB.


MCCLELLAN OSCILLATOR:

Takeaway: Made it to the embedded level and headed for rare air. Indexes all get a signed pair of Jordan's when they get to rare air level - bet you didn't know that right? No reason to think they won't get there with momentum still plenty of room to run to max.


INTERNALS Summary: Internals all bulled out - minus the AB. Not much room for upside momentum wise, but has not seemed to matter in with liquidity in every crevice.


INDEXES:


SPY: Chart with Detailed Levels

Market Structure: Neutral

Momentum: Bullish

Internals: Positive

Block Volume: Positive

GEX: Positive

Put/Call Ratio: Neutral/Bearish


SPY Summary: Bulls on parade. Looking for the 300 level tomorrow. If that doesn't hold...looking for 312 level. Over 312 with VIX sub 25 means bull is back in our playbook. So still a little work to do.

QQQ: Chart with Detailed Levels

Market Structure: Neutral

Momentum: Bullish

Internals: Positive

Block Volume: Negative

GEX: Positive

Put/Call Ratio: Bullish


QQQ Summary: Facebook and Microsoft cooked the last bit of put buyers late in the day. This is now net neutral and most of the FAANGs are too. 230 level should be filled tomorrow/next day if this is for real.

SOXX: Chart with Detailed Levels

Market Structure: Neutral

Momentum: Bullish

Internals: Positive

Block Volume: Negative

GEX: Negative


SOXX Summary: MONITOR. Blew out the MSL. Now neutral. See what price action looks like the next few days here. Should tell us more about next steps.

DIA: Chart with Detailed Levels

Market Structure: Bearish

Momentum: Bullish

Internals: Positive (dropping)

Block Volume: Negative

GEX: Positive

Put/Call Ratio: Neutral


DIA Summary: Dow Jones hitting the underside of the bullish trend channel from before. Will it get back in? Have imagine that it would considering the rest of the market is surfing liquidity. Let's monitor this next few days.

IWM: Chart with Detailed Levels

Market Structure: Bearish

Momentum: Bullish

Internals: Positive

Block Volume: Positive

GEX: Negative

Put/Call Ratio: Excessive Bullishness


IWM Summary: Filled the upside and looking at GEX this can get to 140 easily. If there is more strength overnight then you have to figure it will hit 140. We will take it from there. Not neutral MSL but close. Was weakest link late in the session...

BANKS & HIGH YIELD CREDIT:


XLF: Chart with Detailed Levels

Market Structure: Bearish

Momentum: Bullish

Internals: Positive

Block Volume: Positive

GEX: Negative (but Delta Adjusted says positive now)


XLF Summary: This based on the GEX structure can get up and to the 24 level pretty easily now if it really wants to...oh and (American Express) AXP's response to the worst loan provisions ever disclosed yesterday - hold my beer - up 10% today...JFC

HYG: Chart with Detailed Levels

Market Structure: Bearish

Momentum: Bearish

Internals: Positive

Block Volume: Positive

GEX: HEAVY Negative


HYG Summary: Rally today in High Yield. Jay said he would buy more...or did he?...or didn't he? Momentum is turned up money flow and velocity bounced off zero line - may rally back into the box now.

TREASURIES, $USD, and PRECIOUS METALS


TLT: Chart with Detailed Levels

Market Structure: Bullish

Momentum: Bearish

Internals: Positive

Block Volume: Negative

GEX: Positive


TLT Summary: Price bounced off the second EMA support. GEX is positive. Internals turned back up more. Selling starting to slow - even today. Momentum still bearish. Could see another day or two of back and forth here...found this interesting that this was bought today...should have been scorched earth. Hmmm...

UUP: Chart with Detailed Levels

Market Structure: Bullish

Momentum: Bearish

Internals: Bullish

Block Volume: Positive

GEX: Positive


UUP Summary: Same thoughts as TLT. If we will print anything...everything...and even come up with new printing tools and kits and programs...why didn't the dollar just vomit? The answer is that there is so much deflation out there right now that TLT and the dollar are hedging that the Fed can pull this off...I AM NOT SAYING THAT THEY CAN'T...I AM JUST SAYING THE $USD, GLD, and TLT are hedging that they will not be able to accomplish this.

GLD: Chart with Detailed Levels

Market Structure: Bullish

Momentum: Bearish

Internals: Positive

Block Volume: Positive

GEX: Positive


GLD Summary: Gold bounced right where we thought it might. I am not sure of the next steps here...but any real pull back is a buy. I am curious to see the next few days and to also watch silver here.

SLV: Chart with Detailed Levels

Market Structure: Bearish

Momentum: Bearish

Internals: Neutral

Block Volume: Positive

GEX: Positive


SLV Summary: Silver did nothing today. That is neither good nor bad. Most readings are still in a neutral stance. Have to wait and see how this shakes tomorrow and next day (May 1).

GDX: Chart with Detailed Levels

Market Structure: Bullish

Momentum: Bullish

Internals: Positive

Block Volume: Positive

GEX: Positive


GDX Summary: GDX really looks like it wants that higher high on the chart (if not a little more?)...said that yesterday and same rings true today. Have to monitor tomorrow.

THE END.


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