Last week’s review of the macro market indicators suggested heading into Options Expiration Week, the last full week before Christmas and the FOMC meeting that the equity markets looked weak in the short run and all but the O:QQQ tired or weak on the intermediate term.
Elsewhere looked for gold to consolidate in it downtrend while crude oil ran lower. The US dollar index was back into consolidation with a short term downward bias while US Treasuries were biased higher in consolidation. The Shanghai Composite looked better to the downside short term in its bounce and Emerging Markets flat out broken and falling, but oversold.
Volatility looked to remain elevated keeping the bias lower for the equity index ETFs N:SPY, N:IWM and QQQ. Their charts looked weak in the short term as well. In the intermediate term the IWM was nearing key support, and the SPY testing a shift to a downside bias while the QQQ was still the strongest.
The week played out with gold moving in a channel before probing lower and rebounding to end the week while crude oil continued lower. The US dollar moved slightly higher while Treasuries pulled back but then bounced to end the week near unchanged. The Shanghai Composite found support and bounced while Emerging Markets acted likewise.
Volatility started the week at the highs but settled back, still elevated. The Equity Index ETFs started the week well but made outside reversals Thursday and followed lower Friday. The SPY, the IWM and the QQQ all ended the week lower.
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