The Traders Club of Kuala Lumpur

Deutsche Bank shares tanked 6.7% amid concerns that DB may be unable to settle its potential US14 Billion fine from the US Depart of Justice. The market was settling in for a normal day of trading till midday when the DB issue took centre stage. A news report said some hedge funds that clear derivatives through the Frankfurt-based firm had withdrawn some excess cash and positions. While the vast majority of the bank’s more than 200 derivatives-clearing clients have made no changes, around 10 hedge funds moved a portion of their listed derivatives holdings to other firms this week as reported by Bloomberg. Following that, the indices sold off and volatility spiked.

Oil futures managed a small gain following Wednesday big surge on news of production cuts agreement amongst OPEC countries.

Bonds made small gains for the day.

The dollar index was slightly up for the day and is still range trading.

Dow Transportation traded up till midday before a general market sell-off. It closed with a low closing spinning top doji candle above its moving averages. Momentum remains upward. Volumetric buying pressure is at 33.9%. The index is in a daily, weekly and monthly Squeeze.

Dow Industrial range traded in the morning before a general selloff started at midday. It closed with a bearish candle below its moving averages. Momentum is downward. Short term volumetric buying pressure is at 75.6%. The index is in a monthly Squeeze.

Russell 2000 traded slightly downward till midday before the Deutsche Bank news triggered a general selloff. It closed with a bearish marubozu candle below its 21 EMA but above its 50 SMA. Momentum remains upward. Volumetric buying pressure is at 52.8%.

Nasdaq 100 traded slightly downward till midday before it came under selling pressure. It closed with a bearish rolling pin candle above its 21 EMA. Momentum remains upward. Volumetric buying pressure is at 97.2%. The index is in a monthly Squeeze.

S&P 500 range traded till midday before coming under selling pressure. It closed with a bearish rolling pin candle below its 21 EMA and 50 SMA. Momentum has turned downward. Volumetric buying pressure is at 60.3%. The index is still in a monthly Squeeze.

Metals and Commodities
WTI Crude oil futures had another positive day and is trading at $47.66 per barrel above its moving averages and in a Squeeze.

Gold futures is trading at $1327.8 per ounce. Momentum is sideways.

Silver futures is trading at $19.185 per ounce. Momentum remains downward.

Agriculture (DBA) ETF gapped down and closed at 20.15 with a bearish candle and below its 21 EMA. Momentum is downward.

Commodities (DBC) ETF gapped up and closed with a bullish spinning top candle at 14.96.

Bonds
High Yield bond ETF (HYG) closed with a bearish harami candle above its moving averages at 86.88. Momentum remains upward.

Bonds ETF (TLT) gapped down but surged upward to close with a bullish candle above its moving averages. It is trading at 138.75 above its 50 SMA. Momentum is upward.

Currencies
The dollar index is at 95.475 and is in a daily Squeeze. Momentum is neutral.

EUR/USD is trading at 1.1214 and on its 21 EMA. It is in a daily Squeeze. Momentum is sideways.

USD/JPY is trading at 101.090 and closed with an inverted hammer candle below its 21 EMA. Momentum remains downward.

On a monthly lookback, the relative strength order of the ETFs that are outperforming the S&P 500 are XLE, XLK, XLI, XLU, XLB and XLY respectively.

On a 3-month lookback, the relative strength order of the ETFs that are outperforming the S&P 500 are XLK, XLE, XLF, XLB and XLI.

Market Internals
Vix closed at 14.02. Vix futures is at 16.35. Skew is at 122.67. Market sentiment has turned neutral. Market breadth has flattened. Volumetric accumulation/distribution is sloping upward.

The Week Ahead
Volatility continues and traders are being whipsawed around. With the US election being about six weeks away, the market is now rather news driven. The prognosis is for more volatility and whipsaw action.

Stock of the Day
The Stock of the Day is TROX. Tronox is engaged in the production and marketing of titanium bearing mineral sands and titanium dioxide pigment.

To YOUR wealth!

The major indices reversed upward after two days of decline. The market renewed its confidence from the September Consumer Confidence which rose to 104.1. There is no sign of a production freeze deal at the Opec meeting and oil traded down for the day. The debate between the presidential candidates Donald Trump and Hillary Clinton was scored in favour of Hillary Clinton by the media.

Dow Transportation traded upward on market open and continued upward throughout the day. It closed with a bullish marubozu candle above its 8 EMA, 21 EMA and 50 SMA. Momentum remains upward. Volumetric buying pressure is at 48.1%. The index is in its monthly Squeeze.

Dow Industrial traded upward on market open and continued upward for the rest of the day. It painted a bullish engulfing candle and closed on its 8 EMA below its 21 EMA. Momentum is downward. Short term volumetric buying pressure is at 64.9%. The index is in a monthly Squeeze.

Russell 2000 grinded upward on market open and closed with a small bullish candle above its moving averages. Momentum remains upward. Volumetric buying pressure is at 55.8%.

Nasdaq 100 traded upward on market open and continued upward for the rest of the day. It closed with a bullish marubozu candle above its moving averages. Momentum remains upward. Volumetric buying pressure is at 93.8%. The index is in a monthly Squeezes.

S&P 500 traded upward on market open and continued upward for the rest of the day. It closed with a bullish engulfing candle on its 21 EMA. Momentum is neutral. Volumetric buying pressure is at 45.4%. The index is still in a monthly Squeeze.

Continue reading 27 September 2016 – Volatility and the election year

Nasdaq 100 made another all-time high and the market blasted upward post FOMC. The other indices such as the S&P 500 and Dow Jones Industrial are about 1% away from their all time highs. Post-FOMC, there is little fear in the marketplace and indices have ripped higher as investors pour in in an all out “buy everything” mode.

Energy stocks did well as WTI crude ripped higher by 2% after the EIA announced that domestic crude supplies fell by 6.2 millions barrels. Stocks, bonds, oil and gold and anything that have a price on it was bought up, well most of it anyway.

On the economic front, the Labor Department announced that applications for insurance benefits declined by 8,000 to 252,000 which was below the 260,000 expectation. As a comparison, this is the 81st consecutive week with claims below 300,000 (longest run since 1970).

Dow Transportation gapped up on market open and traded upward till after midday when it was sold down. It closed with an inverted hammer candle above its 8 EMA, 21 EMA and 50 SMA. Volumetric buying pressure is at 30.3%. The index is in its monthly Squeeze.

Dow Industrial gapped up on market open and held its high and range traded for the rest of the day. It closed with an inverted hammer above its 21 EMA but below its 50 SMA. Momentum is neutral. Short term volumetric buying pressure is at 81.6%. The index is in a monthly Squeeze.

Russell 2000 gapped up on market open and traded upward throughout the day. It closed with a bullish marubozu candle above its 21 EMA and 50 SMA. Momentum is upward. Volumetric buying pressure is at 99.9%.

Nasdaq 100 gapped up on market and was volatile in the first three hours of trading as it grinded upward. There was more volatility in the afternoon and it made new high at 4895.5 before the bulls closed it with a small marubozu candle. Momentum remains upward. Volumetric buying pressure is at 99.8%. The index is still in a daily and monthly Squeezes.

S&P 500 gapped up on market open and range traded for the rest of the day. It closed with a bullish marubozu candle above its 21 EMA and 50 SMA. Momentum reversed upward. Volumetric buying pressure is at 69.7%. The index is still in a monthly Squeeze.

Continue reading 22 September 2016 – Up Up and Away!

The market traded cautiously ahead of the FOMC meeting and also the Bank of Japan pronouncement due on Wednesday. The indices started with moves to the upside but that was sold into and by the end of the day, the major indices were showing losses for the day. We can expect volatility to shoot upwards and there could be bigger movements in the equities, bonds and currencies markets.

WTI crude traded higher for the day to above $44 per barrel. The dollar index made small gains and bonds range traded for the day.

Dow Transportation moved upward in the first half hour after market open but the move was sold into. It traded downward for the rest of the day and closed with an inverted hammer candle below its 8 EMA and 21 EMA. Momentum remains downward. Volumetric buying pressure is at 24.2%. The index is in its monthly Squeeze.

Dow Industrial traded upwards on market open but was sold into. It range traded for the rest of the day and closed with an inverted hammer candle below its 8 EMA and 21 EMA. Momentum remains downward. Short term volumetric buying pressure is at 14.3%. The index is in a monthly Squeeze.

Russell 2000 traded upward in the first half hour but was sold into. It range traded and for the rest of the day and closed with an inverted hammer candle. The 8 EMA, 21 EMA and 50 SMA are converging. Momentum is downward. Volumetric buying pressure is at 43.9%.

Nasdaq 100 traded upward in the first half hour and was sold into. It rallied in the afternoon and sold off in the last hour to close with a spinning top doji candle. Momentum is upward. Volumetric buying pressure is at 74.1%. The index is still in a daily and monthly Squeezes.

S&P 500 traded upward in the first half hour and sellers came in. It range traded for the rest of the day and closed with an inverted hammer candle below its 8 EMA and 21 EMA. Momentum remains downward. Volumetric buying pressure is at 10.6%. The index is still in a monthly Squeeze.

Continue reading 20 September 2016 – Waiting for the FED