A day for defense: Currency woes, monster MOC to sell, WB’s most important price on the chart

Brian Shepard
mts marketrecap 330 300x207 A day for defense: Currency woes, monster MOC to sell, WBs most important price on the chart
mts marketrecap 330 300x207 A day for defense: Currency woes, monster MOC to sell, WBs most important price on the chart

Collective Intelligence!

IN THE EYE OF THE STORM – with the next week’s FOMC meeting the next scheduled “Light-ening Rod.” However, we live one day at a time, and for last night and today:

**1) Investors Shun Currency Benchmark Amid Forex Probe—WSJ – Investors are shunning the main benchmark for global currencies amid a widespread probe into possible manipulation of foreign-exchange markets, according to several people who attended a high-level committee of currency-market participants that met in London this week. Trading volumes at the 4 p.m. WM/Reuters fix “are dropping like a stone,” said one participant at the foreign-exchange committee of financial-markets association ACI on Wednesday. The WM/Reuters fix is calculated daily by a unit of State Street Corp. from trades executed either side of 4 p.m. London time. The fix provides a snapshot of currency rates and is used by companies and major institutional investors as a reference point for valuing foreign-currency-denominated assets and liabilities. http://on.wsj.com/1dViomP   **2)  Argentina Just Made A Huge Change To Its Currency Policy A Day After Its Peso Crashed: http://read.bi/1fcda4J

Snippets: Started out with with defense, DEfense and morphed into DEFENSE, DEFENSE!!! Taking profits, de-risk and waves of selling while traders and investors alike acted first and will ask questions later … will this continue?  YES, there is a real possibility, but straight down? That would be the real question. There has been an absence of “real panic” on this downside move; however, the selloff has garnered — and deservedly so — a lot of attention as we head into the weekend which adds that extra element of being closed for two days and arrgghhh, awakening to subzero temps here in Chicago early next week. The 1-2 punch over the last two days has taken a toll … to be honest, the downside move could/should have been deeper on both days - considering all the pent-up frustrations as the equities were running in place over the last month or so. Today the DJIA holds at down  166 points yesterday while today’s dropped 318 points and is now riding a four-day losing streak.

Today started with an above-average 395k ESH and 1.4k SPH traded on Globex, ESH trading range was 1808.00 – 1828.00. Yesterday’s regular trading hours (RTH’s), pit session trading range was 1814.00 – 1829.80 before settling at 1824.20, down 14.4  handles. The RTH’s, pit session, gapped 12+ handles lower with an opening print of 1811.50, the OR range was 1811.50 – 1812.00, marking the intraday high for the second day in a row before deteriorating throughout the day. The first 15 minutes traded 1812.00 – 1806.00 and continued lower through midday. carter (09:37) 30K Eminis just traded in 1 min on the breakthrough of 1805, $2.7bln notional. With trades like that the erosion saw little in the way of any bounces and the late-day trade had two 6-handle bounces that did not hold as the closing imbalance was the biggest we have seen in months.

OK, this is it:  IF 1815.52 cash gets killed THEN the i-ii portion of the most bullish count IS DEAD and this LEAVES THE BULLS HAVING TO DEFEND THE 1767.99 LOW, MAKING THAT PRICE THE MOST IMPORTANT PRICE ON THE CHART AS GIVEN SEVERAL WEEKS AGO. THIS IS BECAUSE THE BULLS WILL BE LEFT WITH ONLY 1 OBVIOUS COUNT before the LEAN THAT GOES TO WHAT THE BEARS ARE TRYING TO ACCOMPLISH with there 1823, 1898.5 COMMITTED/CONFIRMED.

The tale of the tape: Time will tell … The MrTopStep imbalance Meter, MiM, showed a modest sell and grew and grew into SPX MOC IMBALANCE of $3.1Bil FOR SALE going into cash close. The cash close traded 1785.00 area before settling at 1782.10, down 42.1 handles on the day and the biggest volume of the year at 2.5M mini’s.Ugly day ending on a sour note: [DJIA] down 318 points, [SPX] down 2+%, [DJT] off 4+%, [VIX] up 30+%.

Coming events: http://www.investing.com/economic-calendar/
*Earnings pre-mrkt [BOH], [CAT], [NVR], [RCL], [RGS], [ROP], [RYN] and Monday post close – [AAPL], [ASH], [CR], [GGG], [PCL], [PLT], [STLD], [STM], [STX], [X], [ZION].

Last Chance >> Spend a week and then stay awhile … in our professional trading chat room with Jack, Kathy, the Pivot Boss and a gaggle of other qualified contributors who tell it like it is to new traders and veteran traders alike. Join us in the MrTopStep IM Pro Boot Camp runs Jan. 24-30. http://chat.mrtopstep.com/boot-camp?utm=c51ce410c124a10e0db5e4b97fc2af39