It was a mixed month for US equities, SPX -137pts (3.9%) to 3363, with the Nasdaq comp’ -607pts (5.2%) to 11167. WTIC cooled by -$2.39 (5.6%) to $40.22. Copper cooled by -3cents (0.9%) to $3.03. The USD gained +179bps to DXY 93.93. The US 10yr yield cooled by -3bps to 69bps.
SPX, monthly
Nasdaq comp’, monthly
WTIC, monthly
Copper, monthly
USD, monthly
US 10yr yield, monthly
Summary
The SPX, Nasdaq comp’, and the Transports broke new historic highs in September. However, all three saw a very strong swing lower, with the SPX and Nas’ settling powerfully lower for the month. October will likely break a new cycle low, but I do expect m/t supports (such as the 200dma and monthly 10MA) to hold.
WTIC saw the first monthly decline since April, having printed a September low of $36.13. Further cooling to major support of 32/30 would arguably sync with the sp’3100s.
Copper broke a new cycle high of $3.12, if settling net lower to $3.03. The monthly settlement above psy’ $3.00 was the first since May 2018.
USD broke a new multi-month low of DXY 91.75, but swung upward to 94.79, and settling at 93.93. The Sept’ candle is technically not of the bullish engulfing type, but it certainly leans s/t bullish, and I would note the 10MA in the 96s. A failure to clear would threaten renewed downside to the crazy 88s.
US bonds saw further chop, with the US 10yr yield settling at 0.69%. Ongoing Fed QE will keep an underlying bid on bonds, and by default, keep yields pinned lower.
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Looking ahead
Thursday will see the usual weekly jobs, pers’ income/outlays, PMI/ISM manu’, construction, vehicle sales, and the Fed balance sheet (4.30pm).
Earnings: PEP, BBBY, CAG, STZ
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PF chart of the day
The computer is holding to a bearish target of the $33s. Yours truly concurs, and has taken a small short side position in the miners, whilst I wait to go long around the $33s… which seems realistic within October.
*I will post some end month charts on the metals and miners on my various public blogs, which will be linked via Twitter.
Goodnight from London