If you are having difficulty seeing this email, you can view in your browser or click here to print.

Today is the first Fed meeting that the new Fed Chairman Powell will raise Fed Fund rates (100% chance for 25bp and 20% for 50bp) and face questions after from the press.  It's a bit of a wild card as the markets really do not know Powell yet or his mannerisms.  I say that since going back to Greenspan, every Fed Chair has had every word examined for some message.  The markets tend to do well on Fed days and so far the markets are up moderately.  What I'm saying is that this is a coin flipper type of day as one word could be taken from Powell and everything reverses lower.  What markets really like is when the unknown is known.  

Energy and materials are the leading sectors today (the recent worst couple of sectors) while tech is up moderately with Facebook bouncing back after fund manager Bill Miller said "It's cheap at 16x."  Perhaps he's right but the cheap get cheaper when a company's credibility is blown.  Semiconductors are getting closer to some upside exhaustion signals that I've highlighted in the recent weeks. And regards to oversold sectors, consumer staples have been horrible after the upside exhaustion signals in mid January, there are now some downside signals that are starting to come into play.  One of the things I like to see is a bunch of signals within a sector triggering together.  There is a catch that I will explain below about exhaustion signals triggering in wave 3.   Enjoy the snow if you're on the East Coast while watching Fed Chairman Powell's first presser.  

Notable:

• US Markets - Narrow last couple of days with sentiment unchanged
  
• European Markets - Nothing to do here while banks scrape along the lower end of the range
  
• Crude Update - Nice pop off the 60 support level.  Liking SLB and APA as new long ideas
  
• Consumer Staples - Oversold and starting to see downside exhaustion signals - but in wave 3
  
• Semiconductor Update - SMH getting closer to upside exhaustion while MU is a day away and NVDA has another signal today
  
• Copper Update - When both sentiment and DeMark signals work together for a winning trade
  
• Bond Update - Getting closer to the downside exhaustion on TLT - patience
  
• DeMark Screens
  

SPX bullish sentiment was unchanged at 47%

SPY daily is still below the 50 day and with just one word could slip lower quickly

Nasdaq bullish sentiment is at 47% too

QQQ has been in a very narrow range in the last two days.  That's an island reversal above these levels.  Trapped longs hoping to get out.  It's significant since there were huge inflows up there.

IWM Russell 2000 is up the strongest of the US indexes due to the strength in energy and materials.  It's above the 50 day which is support.  Not looking too bad but I don't want to buy with the downside red Countdown still on day 8 of 13.  

Euro Stoxx 50 still nothing here to do

Euro Stoxx 600 is on day 12 of 13 but remember the 13th bar has to be under the close of the 8th red bar.  (just a little extra DeMark rule)

DAX continues sideways and I can't get too excited to do anything

US FTSE has a downside red Countdown 13 today.  The upside exhaustion worked exceptionally well however, there are people (like me) who don't get too bullish when there is an exhaustion in a wave 3 since the next wave is 4 and it's a corrective wave and the least powerful and then followed by wave 5 which will break the low of wave 3.  A wave 5 exhaustion is what I want to see.  

Euro Bank Index continues to scrape the lows of the last year.  

FXI Hong Kong Chinese stocks continues sideways and has a downside red Countdown on day 7 of 13.  

Crude bullish sentiment is at 58% and has been hanging around the mid point of the range for a few weeks now.  Tonight's reading should move this up quite a bit

WTI Crude Futures bounced off the 60 support level despite having a downside Countdown in play.  The downside wave sequence will be nullified if a new closing high can happen.  One thing I've mentioned in the past is this is a very good seasonal time for crude.  

Here's WTI with the Countdownside visible.  Watch the 65.63 level as resistance.  

Back in November I recommended SLB Schlumberger as a long after the downside exhaustion signal and it worked out well.  As you likely or should have seen in the DeMark screens last week was a downside red 13 in SLB and tomorrow you will see it in the "price flip" up list.  I'd buy this with a 65 stop.  

APA Apache also looks buyable with a new red Countdown on day 2 of 13.  It may not be that easy to get over 40.  

XLP Consumer Staples sector ETF has a very good track record with the DeMark Sequential indicator as it has triggered at a couple recent tops and bottoms.  It's on day 12 of 13 today.  Getting closer.  

Here's wave chart with XLP and the issue with the recent downside exhaustion is that it's happening in the 3rd wave not the 5th.  Look at the last wave 3 downside in early October and the short wave 4 concluding with a downside wave 5 with a red Countdown 13.  These are potential trades - be nimble and tight with stops as the wave 4 won't last long.  

PG Procter and Gamble has a downside red Countdown 13 and actually is in wave 5 so this could be bought with a smallish size and add to it when it starts to lift.  I saw today Doug Kass has this as his fav short.  I would cover Doug.  

GIS General Mills has a pink Combo 13 today with the red Sequential on day 12 of 13.  This is in wave 3 and gap downs this big are very difficult to buy as you could ask the people who bought the February gap down.  Let it stabilize

CL Colgate is on day 11 of 13

KO Coke is on day 12 of 13.  

MO Atria is on day 12 of 13.  

SMH Semiconductor ETF has had an upside Countdown since February that I highlighted as the only sector with an upside Countdown.  It's now on day 9 of 13.  

MU is the most overbought stock in the S&P 500 as it's 30% above the 50 day moving average.  Intel is 9% above the 50 day as a comparison and the SMH is 5% above the 50 day - THIS IS THE MIDDLE INDICATOR ON MY WHITE CHARTS FOR NEW PEOPLE TO MY WORK.  THE LOWER ONE IS THE % ABOVE THE 20 DAY.  MU is now on day 12 of 13.  

Nvidia has another upside red Countdown 13 which looks similar to the November high ahead of a 16% drop.  NVDA is up 900% (yes no typo) since the significant market low of February 2016.  

Copper bullish sentiment is at 25% and has made a new recent low.  Back when this was at 90% bulls there was an upside exhaustion and I recommended selling it with the combined factors

Copper Futures has rolled over and my target of 300 was conservative.  

Bond bullish sentiment is at 27% and has backed off a little from the mid 30's

10 Year Bond Futures had recent downside exhaustion signals however I've been saying I wanted to see a turn develop and that clearly hasn't happened yet.  

TLT Bond ETF has been good with the DeMark indicators and I've been patiently waiting for the downside exhaustion to trigger.  It's on day 11 of 13 thus a little more to go

Unsubscribe me from Hedge Fund Telemetry

Hedge Fund Telemetry LLC, P.O. Box 4675, Greenwich, CT 06861, United States