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9/12/18
Thomas Thornton

Meet your new girlfriend

Today Apple will unveil new iPhones to nobody's surprise there will be three new models.  We used to joke that Steve Jobs game was to get us to buy a new iPhone after we recently bought or  married ourselves to the current one but Steve would say take a look at your new girlfriend, she's thinner, faster, and prettier.  Nobody could ever sell a product with excitement and sizzle like Steve Jobs. (Take a look on You Tube of his product announcements).  Tim Cook has done a decent job of trying to replicate Steve's selling process but the sizzle is long gone along with the surprises that would make the new girlfriend irresistible.  Today we already know what is coming out ahead of time but the only surprise is pricing.  Pricing has been going up and it's benefited ASP's for Apple and offset the slowing unit growth in the past few years.  There was hopes of a super cycle of upgrades that never happened and I would say two things have limited the upgrade cycle - pricing and the fact that Apple makes great phones that do not need to be replaced as people will say "I'll stick with my wife despite her being a little old, fatter, slower, and cheaper."   These event's also tend to be a sell the news event with the stock down .5% on average.  

As I am writing today's note, the markets have spiked to highs with story of U.S. Proposing New Round of Trade Talks with China in the Near Future, Sources Say.   Obviously this is a good thing but the level of talks have been unproductive and China knows the midterm election is ahead so they can play the card to not rush into anything.  And adding in the gains have come right back down.

I will be off the desk later so I will get back to email as soon as I can.  New website will launch Monday.  

  • US Markets - a little choppy today on headlines with China tariffs
  • Hedge Fund Telemetry Trade Ideas - Added GDX long
  • Meet your new girlfriend - Apple
  • Tom DeMark on Bloomberg TV today
  • Transports - A look at the sub sectors
  • Semiconductors - Canary in the coalmine
  • Currency Update - USD should work lower and Euro higher
  • European Market Update - Small bounce in Eurostoxx 50
  • Global Market Update - EEM Setup 9 today so let's see if this can turn
  • Crude Update - Turning bias to positive
  • Gold Update - GDX worth a shot on the long side
  • Bond Update - Expecting US 10 year yields to rise
  • DeMark Screens - Daily, Weekly, Monthly upside/downside exhaustion signals within the S&P 1500 and Euro Stoxx 600

US Markets


Here's a link to the Hedge Fund Telemetry market sentiment page with 40 charts of sentiment including equities, bonds, currencies, and commodities updated each day.   

SPX bullish sentiment is at 70%


SPX daily still at risk


Nasdaq bullish sentiment is at 62%


NDX Index has been unusually the weakest of all the major US Indexes with this pullback


Dow Jones Industrial Average sideways


IWM Russell 2000 starting to weaken

 
Hedge Fund Telemetry Trade Ideas


Trade Ideas - Added long GDX Gold Miners ETF with a 2.5% sized position

 
Meet Your New Girlfriend


Here are the new iPhones.  The names seem to be reverting back to the John Skulley years.  Boring.


Weekly on Apple hit the upside wave 5 price objective with a green Setup 9 too.  

 
Tom DeMark on Bloomberg TV Today


Tom was on Bloomberg TV today.  He is getting close again as a long with the Shanghai Index.  


One way to play is to buy the FXI.  I'm going to wait for a little bit of a turn up before I get long


Tom also showed how the US Consumer Confidence is nearing a monthly Sequential 13 (on month 11 of 13) and how this could peak right at the Election in November.  I've been showing this chart for several months now.  


Tom also showed the US Unemployment Rate on month 11 of 13 which could have a 13 also on the November election.  

 
Transports - A look at the subsectors


Transports Index on a weekly time frame has a recent upside Sequential 13 and is on week 8 of 9 with a green Setup


Airlines are nearing March highs.  Bad tick in there


Rails stretched at wave 5 target


Truckers.  Key Bank was out yesterday with a note saying they could see slowing towards the end of the year


Autos have been terrible with several failed downside exhaustion signals.  

 
Semiconductors - Canary in the Coalmine?


I had a note out months ago titled Canary in the Coalmine with semi's.  Semi's go into everything and they tends to stall out ahead to market and economic tops.  

 
Currencies


US Dollar bullish sentiment is at 40% and this down from the recent high of 96%.  


US Dollar Index should work lower with the red Sequential Countdown in progress


Euro bullish sentiment is at 47%


Euro Spot should work higher

 
European Markets


Euro Stoxx 50 slight turn today up

 
Global Markets


EEM Emerging Markets ETF with green Setup 9.  CNBC is doing a story if one should buy the "dip" in Emerging Markets.  A 20% drop over 8 months is not a dip

 
Crude Update


Crude bullish sentiment is at 80% and extreme but feels higher with a series of higher lows on the sentiment


Crude looks higher even though it is up due to the hurricane supply disruption fears. I thought this could work lower but as of now I'm changing bias to higher

 
Gold Update


Gold bullish sentiment is at 27% still well off the low of 6%


Gold Miners could be time for a turn up.  I added 2.5% size to long side of Trade Ideas Sheet

 
Bond Update


Bond bullish sentiment is at 65% and starting to drift lower


US 10 year still within range and my thought is we will see higher yields

 
DEMARK SCREENS - Daily, Weekly, Monthly Upside/Downside Exhaustion Signals

Daily/Weekly DeMark upside/downside exhaustion signals (Sequential) weekly updated on Monday's and monthly on the first day of the new month.  Price flips occur when a stock closes higher/lower than four previous closes and increases conviction of a price turn.

The upside 13's are sell signals and downside 13's are buy signals.  Price flip's are confirmation signals that increases potential for a price trend change. For example, if you are long a stock and there is an upside 13, you will want to take cautious action by selling down or out of a position.  If initiating a short sale with the upside 13's, we tend to start with a 1/2 size and add with the downside price flip.  The opposite is true for when there are downside 13's.  Take a 1/2 size position and add with the upside price flip.  The DeMark Indicators are designed to assist the user with buying into weakness and selling into strength to anticipate trend exhaustion. Selling into a rally and buying into a decline often afford the opportunity to exit a trade without too serious a loss if wrong.

S&P 1500 Universe:
DAILY UPSIDE 13:   ALB, ALGN, AVAV, BTU, CME, IT, MRCY, PH, RHT, SWX, VSI
DAILY DOWNSIDE 13:   CVG, LHO, RGLD, TTEC


DAILY UPSIDE WITH PRICE FLIP REVERSAL DOWN:   AFL, CBSH, DTE, EGL, EIG, NAVG, PNM, RMD, SWK
DAILY DOWNSIDE WITH PRICE FLIP REVERSAL UP:   DO, PETS PTEN

Updated: 9/10/18
WEEKLY UPSIDE 13: BRC, CIEN, EBS, ESRX, POOL, TXT
WEEKLY DOWNSIDE 13:   NONE

Updated: 9/4/18
MONTHLY UPSIDE 13:    AFG, AJG, AMD, CBT, CECO, EIG, IR, MAA, MRCY, MSA, MSFT, NSC, ORI, ROK, TDY, TTWO, UNT, UNP, WCG, WTR
MONTHLY DOWNSIDE 13:    FTR, RRD, SMCI, SSI

Euro Stoxx 600 Universe:
DAILY UPSIDE 13:   BNZL LN, CAST SS, CPR IM, US IM
DAILY DOWNSIDE 13:  TEN IM

DAILY UPSIDE WITH PRICE FLIP REVERSAL DOWN:    NONE
DAILY DOWNSIDE WITH PRICE FLIP REVERSAL UP:   EN FP, ILD FP, ITV LN, KOMB CP, LXS GR, ORA PUB FP


Updated: 9/10/18

WEEKLY UPSIDE 13:  IPN FP, LISN SW, SRT3 GR
WEEKLY DOWNSIDE 13MONY LN, RPC LN

Updated: 9/4/18
MONTHLY UPSIDE 13:     ACKB BB, GALP PL, IPN FP, KOMB CP, MTX GR, UCB BB
MONTHLY DOWNSIDE 13:  ALPHA GA, BARC LN, TL5 SM




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