NQ Guideline For Monday

Daily uptrend remained intact as the stock market continued to rally on Friday in its usual choppy narrow range pattern as the only buyer in town is the Fed. Most investors are either already long or are already short the market.

 

Central banks will continue to create money out of thin air in order to keep the market up, until the whole paper money collapses. Until then the stock market may just continue to melt up.

 

NQ support going into Monday will be 4710.

-- Staying above 4710 is an indication the uptrend is continuing without a pullback. The next upside target is a break above Friday swing high.

-- Breaking back below 4710 implies NQ is in a pullback down mode. The next support is 4700. It would take a bearish news for NQ to clearly break below 4700 price level. 

 

Major bearish divergence between S&P500 and earnings, and something will have to give, sooner or later.

NQ Guideline For Friday

The stock market continued to rally on Thursday albeit, in the usual choppy fashion simply because the Fed is the only buyer in town. The choppy narrow range uptrend should continue for a while longer as there are much more QE and helicopter money coming from major central banks to buy up the stock market.

 

Eventually central banks money creation binge would cause a total loss of confidence in fiat money and then the entire paper money monetary system would simply collapses, but there is no way to know when that would happen simply because a loss of confidence is not an economic event. In the mean time, we want to continue to stay with the trend and they current uptrend is up.

 

Support for NQ going into Friday will be 4700.

-- Trading above support implies NQ is heading into another higher high day, with upside target above Thursday swing high.

-- Trading below 4700 is an indication NQ  may be going into a pullback down day. However, Friday tends to be a choppy sideways type of day.

NQ Guideline For Thursday

On Wednesday the FOMC announced they are not changing their policy, said very little. Gold pops, stocks finish flat. Money pours into corporate bonds as sovereign yields go negative. G-20 commits to more stimulus. Debt keeps soaring while yield curves flatten.

With major central banks, beginning with the BOJ, PBOC and the ECB which should then be followed by the Fed and the BOE embarking on more money creation, including helicopter money program the forces of deflation may be temporarily defeated for now. Central banks should be able to push the stocks and bond market up for a while longer, how much longer no one knows as it is purely the battle between deflation and central banks money creations.

 

On a short term time frame however, support for NQ going into Thursday trading will be at 4680.

-- Staying above 4680 is an indication the uptrend is still strong with the next target is a break above Wednesday swing high.

-- Breaking below 4680 implies NQ is going into a pullback mode with the lower support at 4660 and then 4645.

NQ Guideline For Wednesday

As expected the equity market simply traded sideways ahead of the FOMC announcement on Wednesday, and it should continue to do so until the FOMC announcement in the afternoon.

 

The FOMC announcement would have to be dovish to keep the stock market elevated. A non-dovish or hawkish statement could start the summer selloff immediately or a bit later as the Fed is likely to try to hold the stock market up as long as they can.

 

But how long can they keep the stock market up remains to be seen because China is continuing to devalue their currency, the Yuan. A declining Chinese Yuan versus the USD is bearish for the stock market.

 

On the short term time frame, key balance price level for NQ remains at 4650.

NQ Guideline For Tuesday

The market traded sideways on Monday ahead of the FOMC meeting this week. Short-sellers are just too gun shy about going short ahead of the FOMC announcement on Wednesday simply because the Fed is likely to trigger massive buy programs before, during and after their announcement, regardless of what decision they may make.

 

Without any buyers except the Fed themselves, the market simply trades flat in a very narrow range on Monday, and the pattern should continue until the Fed announcement on Wednesday.

NQ Guideline for Monday

The battle between central banks buy programs to push both the stock market and the bond market upward in order to create an illusion that the economy is doing well against the underlying intensifying global deflationary forces continues on.

The talk of helicopter money programs in Japan, Europe and the Fed has failed to rally the market in a big way, an indication the forces of deflation may begin to overwhelm central banks. NQ simply traded sideways with a small bullish bias on Friday, with the pattern expected to continue ahead of the FOMC meeting next week.

 

The FOMC decision could have a powerful impact on the market trend. Failure to announce an imminent increase in their current QE program and imminent launching of their helicopter money program could start to trigger the beginning of global summer selloff. It will be particularly bad for the emerging markets as the US dollar would rocket up.

 

If the FOMC announcement has a dovish tone and hint of more QE and helicopter money the stock market should continue to rally up in a choppy slow fashion until all the shorts has capitulated before it can begin to selloff.

 

Key support/resistance price level for NQ on Monday will be 4450.

-- Lower supports are 4420 and 4400

-- The next upside target above 4450 is a break above Friday's high.

NQ Guideline For Friday

Following a trending up day on Wednesday, NQ traded sideways in a choppy narrow range pattern on Thursday.

 

The major equity indices has not been able to mount a two-day back to back rally since the beginning of July, lately has struggled to rally now that they are in deep overbought territory on the daily chart.

 

Following Thursday consolidation type of day, it should be followed by a rally up day on Friday. However, as Friday tends to be a choppy sideways type of day, it should not surprise us if NQ simply traded sideways.

 

On a short-term 5-minute timeframe, key balance price level for NQ on Friday will be 4540.

-- Trading below 4540 is an indication NQ is still in a pullback down mode, with the next support at 4520. Below that a strong support is at 4500.

-- Trading back above 4540 is bullish, NQ may need to rally above Thursday swing high to take out the stop-losses before it can pullback down on profit-taking.

 

Nikkei reports Japan stimulus package (helicopter money) could be as large as 30 trillion yen

NQ Guideline For Thursday

Wednesday's trading pattern for NQ mirrored Monday's pattern, a very common pattern for the current Fed-driven manipulated uptrend.

 

Typical trading day would be a gap-up opening followed by massive Fed buy programs that pushes the market up sharply in the morning that faded away by lunch time that then spend the rest of the day in a sideways choppy narrow range.

 

The key is to catch the early morning trend, right from the opening bell until around noon, then expect the market to choppy around the rest of the day. 

 

With the Fed concerned about a sharp breakout of the US dollar index above it 200-DMA which will be very bearish for the stock market, look for the Fed statement announcement following their FOMC meeting next week to be dovish, and may hint a new round of QE and helicopter money program as they would need to do so to save their ailing wall street member banks.  

 

In anticipation of a dovish statement by the Fed next week with a hint of new QE and helicopter money program could help push the stock market higher ahead of FOMC meeting next week.

NQ Guideline For Wednesday

Another narrow range consolidation day for NQ on Tuesday.

 

With the equity market currently in deep overbought territory on the daily timeframe, it is reasonable to expect the current choppy trading action should continue until they let the market have a decent pullback down move down to support.

NQ Guideline For Tuesday

Relentless buy programs triggered soon after the market opened on Monday clearly failed to attract any buyers into the equity market as NQ simply traded sideways after the early morning ramp up rally fizzled around noon, followed by a sharp selling near the close.

 

The current uptrend has clearly ran out of buyers except the Fed buying algorithm now beginning to get overwhelm by the forces of deflation. The equity market would welcome a much needed pullback selling before it can sustained a trending rally, as long as selling does not get out of control and break key support zones.

 

For Tuesday look for a choppy sideways consolidation price action to continue. Earning season is here and may increase volatility

NQ Guideline For Monday

A gap-up open on Friday failed to attract any buyers or short-covers and NQ drifted sideways with a bearish bias. The Fed will continue to trigger buy programs during low volume night trading hoping to trigger buying or short-covering when the market opens for the regular trading session. However, the forces of deflation continues to put downward pressure on the equity market.

 

Even with the launching of a new rounds of global QE programs and the launching of helicopter money programs in Japan failed to sustain continuing.

Unless the Fed triggers major buy programs, look for the equity market to continue to trades sideways down to support before it can make a major trending move up again. NQ more relevant prior high support on the daily chart is at 4530.

 

Loretta Mester, president of the Federal Reserve Bank of Cleveland and a member of the rate-setting Federal Open Market Committee (FOMC), signalled imminent launching of Helicopter Money program in the US, to stoke spending, in addition to interest rate cuts and quantitative easing.

Helicopter money is where stimulus is directly pumped into the real economy, a direct payments to households and businesses, not through the banking system.

More QE and Helicopter Money is extremely bullish for Gold and Silver prices  

NQ Guideline For Friday

Wednesday night buy programs managed to cause a gap-up opening for NQ on Thursday. However, even with major helicopter money program in progress in Japan which helped whack the Japanese yen down, there was no follow-up buying participation in the equity market. NQ simply traded sideways all day on Thursday.

 

The pattern of choppy narrow range pattern should continue as central banks continue to battle the forces of deflation, their tools getting less and less effective, an indication the beginning of the end for central banks is already in progress.

NQ Guideline For Thursday

Without any new buyers or short-covering, the Fed was not able to hold the equity market up on Wednesday, as NQ simply traded sideway with a slight downward bias.

 

Without any new buyers or short-covering NQ may continue to trade sideways with a down bias on Thursday, unless of course the Fed buys aggressively. Next support is 4530.

 

Japan hope that their helicopter money program could hold down the value of the Japanese yen

NQ Guideline For Wednesday

Buy programs continued on Monday night and into the opening bell on Tuesday. NQ opened with a gap-up, but lack of buying participation by investors caused NQ to simply traded sideways all day into the close.

 

With the equity market currently in overbought condition on the daily chart, look for the market to either trade sideways or pullback down on Wednesday, unless of course they are willing to trigger massive buy programs and push NQ above Tuesday swing high. If so, there may more shorts that needs to cover.

 

With gold in deep overbought condition on Tuesday, it was easy for them to whack it down, and so it was, as gold was whack down hard.

NQ Guideline For Tuesday

Buy programs continued on Monday designed to push the major equity indices to all time new high in order to create an illusion of prosperity. The buy programs should continue a while longer to ensure that the breakout to new high is sustained. The last thing central banks want to see is a false breakout situation.

 

However, once the euphoria from massive new round of global central banks money printing activities has fade away the forces of deflation will come back with a vengeance to crush global central banks.

 

Now that the Dow and the S&P 500 has made a higher high above 2015 high, it should soon be followed by a sharp summer/fall selloff followed by rally.

 

This current new round of quantitative easing could be one of the last round before the global fiat monetary system collapses, and gold and silver standard reign supreme again. The timing of the collapse is very difficult to forecast but the final cycle top and the beginning of the end could starts between 2018 to 2019  

NQ Guideline For Monday

The equity market rallied sharply on Friday as buy programs continued to run over stop-losses. There is really nothing to stop the buy programs anytime soon as the goal of central banks is to create an illusion that the economy is doing well.

 

But the prosperity is just an illusion, just a bubble, created by easy credit, and all bubble burst, and it seems the bursting of the bubble is not too far away. Central banks are now beginning to lose their battle against gold an silver, with gold and silver continuing to rally sharply as investors starts to lose their trust in central banks and running into gold and silver to protect their wealth against central banks who are hell bent on collapsing their fiat currency.

 

The Fed official announcement of new credit easing programs should rocket the stock and the bond market one more time before the whole financial system collapses. Gold and silver will then reign supreme again as the only currency left standing when all fiat currencies value falls to zero.

NQ Guideline For Friday

Against intensifying deflationary forces the equity market simply traded sideways on Thursday as central banks were unable to push the market higher ahead of the employment report on Friday.

 

Whatever the report may be, the Fed would have to make some kind of announcement regarding monetary easing very soon before the USD breaks out of resistance. A USD break above resistance is bearish for the stock market and could unleash selling that would overrun central banks buy programs.

 

NQ key support for Friday will be 4435 and NQ would need to stay above 4435 in order to keep sellers at bay, and may even trigger some end of the week short-covering activities.

 

Trading below 4435 is an indication NQ is potentially going into a larger pullback down move. Next support is back at 4400.

 

Deflationary forces created by negative interest rates is killing all the major banks, with many on the verge of bankruptcy as their stock price continue to drop. Below is a chart showing banks share price decline over the last 16 years, from the year 2000 to now.

NQ Guideline For Thursday

Attempted selloff at the open on Wednesday was aggressively bought, and the buy programs continued all day long into the close. NQ had a large range up day on Wednesday.

 

With the Fed ready to launch some kind of quantitative easing, one possible format would be forward guidance, buy programs should continue to be very active in the equity market. The gold market, the silver market and the bond market are already anticipating more easing from all central banks until the whole system collapses.

On Thursday support/resistance price level for NQ is 4435, bullish above, and implies rally to continue. Below 4435 is an indication NQ is going into a sideway move before exploding up again, as long as sideways move does not get out of hand.

NQ Guideline For Wednesday

The battle between central banks buying and forces of deflation pushing the market down continued on Tuesday with deflation winning the battle as the market decline.

 

With global central banks on the next round of QE, they are starting to lose their fight against precious metal as investors are starting to pile into precious metal to protect themselves from global central banks hell-bent on destroying paper currency.

 

Market volatility should continue to be elevated going foreword as the battle between central banks and forces of deflation intensifies, with sharp selloff that is followed by sharp rallies.

 

Key support/resistance price level for NQ during Wednesday trading will again be 4400. First resistance is at 4450 with first support at 4340

NQ Guideline for Tuesday

The equity market rally hard on Friday ahead of the long 4th of July weekend. With most traders back on Tuesday the direction of the market would depends on what the Fed is going to do with the monetary policy.

 

With Europe and Asia on their next round of quantitative easing program the Fed would have to do something to prevent the US dollar from breaking out to the upside. A breakout could trigger global stock market selloff, definitely something the Fed would want to prevent.

 

All major stock indices are set continue to rally but a US dollar breakout could spoil the party. Key support for NQ on Tuesday will be 4400. Rally should continue above 4400.

 

Helicopter Money?