domingo, 26 de junio de 2016

domingo, junio 26, 2016

Polls Fail To Call It Right Again
0
 
7-6-2015 3-33-10 PM euro


Believing in the accuracy of polls once again, bulls were slaughtered as the BREXIT vote reversed late polling results calling for an exit vs remain.

The shock hit stock markets globally quite hard.

It must be said in the U.S. at least the declines only wiped out, and then some, all of the previous silly rallies.

In other words, bulls were caught wrong-footed which created some panic selling.

And, while the declines were sharp and much more to come as former Fed Chairman Greenspan noted, “…it’s just the tip of the iceberg”.

And another word regarding the ineffectiveness of poll results, especially lately, you might remember California’s recent poll showing Clinton vs Sanders was quite off. When there are telephone polls, how likely are these to be accurate when many likely voters don’t even have land lines any more. Just a thought.

One common theme between the UK result and U.S. sentiment currently is with anti-immigration. 

The Dow fell over 600 pts, S&P 76 pts, and Nasdaq over 200 pts. Losses were widespread as only gold and bonds were able to rise. Currency markets were roiled by vote outcome. Pundits with product to sell you were universal in their "stay-the-course" mantra, this was not a 2008 replay and so forth. 

Major losses were felt in the financial sector where banks are presumed to bear losses in loan exposure within the eurozone. Losses were heavy with Lloyds Bank leading the charge lower by nearly 25%. Frankly, I thought losses in most markets were relatively minor compared what many expected after the results were tabulated.

Clearly, Central banks have plans to inject liquidity to markets to stem sharp losses.

Below is the heat map from Finviz reflecting those ETF market sectors moving higher (green) and falling (red). Dependent on the day (green) may mean leveraged inverse or leveraged short (red).

6-24-2016 3-15-38 PM

Volume gigantic while breadth per the WSJ was negative.

6-24-2016 3-16-22 PM
 
12-17-2015 9-04-44 PM Chart of the Day
 
 
 
6-24-2016 3-23-08 PM SLV




Charts of the Day


  • SPY 5 MINUTE

    SPY 5 MINUTE


  • SPX DAILY

    SPX DAILY

  • SPX WEEKLY

    SPX WEEKLY

  • INDU DAILY

    INDU DAILY

  • INDU WEEKLY

    INDU WEEKLY

  • RUT WEEKLY

    RUT WEEKLY

  • NDX WEEKLY

    NDX WEEKLY

  • XLB WEEKLY

    XLB WEEKLY

  • XLE WEEKLY

    XLE WEEKLY

  • XLF WEEKLY

    XLF WEEKLY

  • XLI WEEKLY

    XLI WEEKLY

  • XLU WEEKLY

    XLU WEEKLY

  • XLV WEEKLY

    XLV WEEKLY

  • XLY WEEKLY

    XLY WEEKLY

  • XRT WEEKLY

    XRT WEEKLY

  • IYR WEEKLY

    IYR WEEKLY

  • IYT WEEKLY

    IYT WEEKLY

  • ITB WEEKLY

    ITB WEEKLY

  • TLT WEEKLY

    TLT WEEKLY

  • UUP WEEKLY

    UUP WEEKLY

  • FXE WEEKLY

    FXE WEEKLY

  • FXB WEEKLY

    FXB WEEKLY

  • FXY WEEKLY

    FXY WEEKLY

  • GLD WEEKLY

    GLD WEEKLY

  • GDX WEEKLY

    GDX WEEKLY

  • DBA WEEKLY

    DBA WEEKLY

  • USO DAILY

    USO DAILY

  • DBC WEEKLY

    DBC WEEKLY

  • EFA WEEKLY

    EFA WEEKLY

  • EEM WEEKLY

    EEM WEEKLY

  • IEV WEEKLY

    IEV WEEKLY

  • NYMO DAILY

    NYMO DAILY
    The NYMO is a market breadth indicator that is based on the difference between the number of advancing and declining issues on the NYSE. When readings are +60/-60 markets are extended short-term.



  • NYSI DAILY

    NYSI DAILY
    The McClellan Summation Index is a long-term version of the McClellan Oscillator. It is a market breadth indicator, and interpretation is similar to that of the McClellan Oscillator, except that it is more suited to major trends. I believe readings of +1000/-1000 reveal markets as much extended.

  • VIX WEEKLY

    VIX WEEKLY
    The VIX is a widely used measure of market risk and is often referred to as the "investor fear gauge". Our own interpretation has changed due to a variety of new factors including HFTs, new VIX linked ETPs and a multitude of new products to leverage trading and change or obscure prior VIX relevance.




 

It’s apparent Bulls jumped the gun on BREXIT results seduced by bad poll data.

This led to significant losses as they had to close those positions.

Volume this day told the story on those positions which were quickly stopped out.

What’s next is anyone’s guess. I liked Greenspan’s comments which would lead one to believe tough times are ahead over the intermediate term. To my thinking this could be over the next 1 to 3 years.

Remember to exit is to negotiate terms and that’s a political issue.

Let’s see what happens. 

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