Technical Tuesday – Weak Bounces Ahead of the Fed

This is just sad:  

As you can see, the Nasdaq 100 has now failed the Weak Bounce Line (19,200) Thursday and yesterday and, as you can also see – we stopped dead (as in cat) at the declining 50-half hour (not actually a thing) moving average, which is very very weak technical resistance – AND WE CAN’T BEAT THAT!!! That is, in technical parlance, not good…

Here’s a fun game, find the last closing volume spike that wasn’t red. It was over a week ago, on the 22nd and it was a very tiny, weak volume spike or a “spikette“, in technical terms (yes, you’ll learn all the lingo here!). Even worse, the RSI still hasn’t fallen much below 50 (46.75) so we’re nowhere near oversold but that’s the 30-minute RSI and NO ONE gives a crap about that so how about we use a real chart for goodness sake?

Ah, now that’s better or, actually, no it isn’t because now the RSI is 56.21 – so we’re still clearly in overbought territory and, as you can see, we’re clearly consolidating along the Weak Retrace Line, which is the HOPEFUL support line we were using on the 30-minute chart and it looks like it’s going to fail and, if that happens – it’s a hard and fast drop to the next HOPEFUL support line, which is the Strong Retrace (from the top of our range, 20,000) at 18,000 and that’s ANOTHER 1,000-point drop .

Will the Fed save us tomorrow? Will MSFT save us this evening, will TSLA save us this evening? If the Fed fails, will META or QCOM save Wednesday evening. If not, TM, SHEL, COP & BUD are on deck Thursday morning with AAPL, AMZN and INTC that night and finally we have XOM and CVX Friday morning but Oil is at $75.33 this morning – so they are f’d – or as F’d as you can be with $135Bn in Revenues and $15Bn in profits between them in 90 days.  

Still, you are only as good as the last family you robbed at the pump and oil has fallen more than 10% in the month of July and the cost of extraction and delivery have not gone down so it’s those all-important marginal profits that are getting squeezed out of the equation for the oil majors so, rather than saving the markets, they might just DOOM US ALL – just like they have already done to the planet – so that makes total sense…

And I hate to bring up politics but I love to bring up idiocy and our favorite right wing-nut, Donald Trump is already screaming “Conspiracy!” and claiming that Kamala Harris is plotting with OPEC to bring down the price of oil, which will reduce Inflation and make the GOP’s main talking point seem even more foolish into the election in which Trump is once again certain to lose the popular vote – for the 3rd consecutive time.  

733 people ReTruthed Trump’s comment so it must be true, right? What’s actually going on is OPEC failed to increase their already severed production cuts and the Houthi thing in the Red Sea has petered out and the Israel was hasn’t spread and the US just hit 13.5Mb/day of production – a new record, passing Saudi Arabia as the World’s largest producer of oil.

All this is happening while the Global Economy – especially China – is slowing so demand is nowhere near what was expected in the summer of 2024 – even with record air travel. That’s because we’re also selling record numbers of electric cars and hybrids – despite the misinformation you hear in the US Corporate Media because Big Oil is still a lot bigger than Big Solar or Big Wind and they still control most of the information you receive… and the GOP, of course…

Oil can and will be profitably delivered to you for $75/gallon. Heck, oil companies were making tons of money at $60/gallon – just not ungodly amounts of money usually reserved for AI and Cloud Service Providers and, of course, Search and Social Media sites because THAT IS WHAT MATTERS in our society, right? When I think back on the Mayans, the Incas, the Aztecs, the Romans, Babylon, Egypt and Greece – I judge them not by the monuments, the arts and the inventions they left behind but how they powned their enemies in the chat rooms, right?  

And that’s perfect for Trump because what is he but a powner? He builds garish block of uninspired steel and concrete and most of his works have already fallen into bankruptcy – if not actual dust- due to shoddy construction and even shoddier financing. The only thing he really excels at is social media trolling – for that he should be elected king because THOSE ARE AMERICA’S PRIORITIES IN THE 21st CENTURY.  

Keep in mind that, just last week, we discussed polls that showed that 2/3 of the public think we are already in a Recession – because that’s the way it feels for the bottom 60%, who live from paycheck to paycheck – if there is any paycheck at all.  

Nonetheless, for the 8th consecutive meeting traders are betting on an “almost certainty” of rate cuts at the next meeting and, like our beloved former President, being wrong over and over and over again does not deter them from betting on the same outcome with the same degree of certainty because, apparently, being wrong over and over again has no consequences in America – just ask any leading Economoron – they haven’t been right about anything since the 60s! 

Deutsche Bank’s Jim Reid calls this an  “inbuilt dovish rates bias” which is just a nice way to say wishful thinking – something both remaining Jets fans are very familiar with. To be fair, the Jets did have a winning season in 2015 (10 and 6) but, since then, it’s been 41 and 90. So they do win ALMOST 1/3 of the time – just like our citizens!