I wanted to post a chart with some notations that I feel are quite telling. As I watched many an interview and read many a commentary on the recent weakness surrounding these markets I was, once again, struck on just how clueless and vapid (whether intentionally or not) most of the so-called “analysis” of the current state of these “markets” were. Is it any wonder why their ratings are no longer listed, but I digress.
Below is a chart of China’s Hang Seng Index represented via daily intervals of bars/candles. I’ve made some notations that are easy enough to understand even if one doesn’t really get all that “technical stuff.” You don’t have to, I do, so with that here’s what I’m looking at. To wit:
What the above depicts are a few items that need to be watched over the coming weeks, for they may, repeat, may give some indication of what may be coming over the horizon that has the potential to disrupt these “markets” in ways I’ll bet the now Chair Fed. Powell may curse the day he accepted the position.
To repeat, the above is only for illustrative purposes as to show what happened prior, it’s result, what’s happened since, along with the same size and scope in proportion and when these moves began manifesting. Hint: rhymes with initial interest rate hikes, and verification of balance sheet roll offs.
The resulting moves speak for themselves.
Should China’s market cascade in what’s called a “falling knife” styled selloff from where it resides as of this writing, to where I notated at the bottom of that chart, the question is: Do you think they’ll be some panicked style gyrations felt throughout the entire market complex? Or, does one want to just sit back and say, “Hey, the people on the television said ‘It’s all baked in’ just a week or so ago, and they must know what they’re talking about, right?”
As always, we shall see. But one last note. If you think the above looks a little unsettling? Hint: Europe’s aren’t looking that much different. And that’s the supposed “developed markets” as opposed to China which is still considered an “emerging market.”
But the people on the financial TV shows are there because they’re the so-called “smart crowd” right?
© 2018 Mark St.Cyr
I received a call from a collegue nearly moments after I posted asking me along the lines of “So what does that mean for the U.S. in your purview? Here’s the “picture” form of the probable 1000 words I used. To wit:
The above is the S&P 500™ as of about 9:45am ET. The intervals are represented via 15 minute candle/bars. I believe nothing more needs to be added for it’s pretty self explanatory. I thought I’ld just add it to the previous hypothesis for those of you who also may want to know what I’m currently looking at.
As always, we shall see.
© 2018 Mark St.Cyr