Markets gaining but not confidently - leading up to elections...

Markets gaining but not confidently - leading up to elections and CPI

Yes ESS lost 2c to finish at 47.5c. Our volume was on the lower side of our average, just over 2.1m shares traded. So we could not go past 50 today - Li stocks today did not show the strength we needed.

ASX Li stocks were mixed but the gainers were slightly more. Of the 54 stocks I track, average gain was close to 1.5%.

Overnight US Li stocks really struggled even though the indices were rising. The ETF of LIT fell around half percent, and rest of the stocks could only gain an average of half percent. That lack of strength in US Li overnight may have been a factor in ASX Li not being very strong.


What next -

Yesterday I had said that stats say that US markets generally have a good Monday. And the tradition continued. Although indices opened weak, but picked up during the day - finishing close to the day's high. SP 500 finished on 3806. ASX though did not match US, finishing just over a third of a percent.

SP 500 has now crossed 3800, the first step as mentioned yesterday. Its now above its 50 day moving average. Next is to be above this and reach 3890/3900 mark - the resistance which it was not able to confidently overcome in its recent flight. From a downside perspective - 3780 and finally 3720 - if this is not held, we may have a bigger fall.

From indicators perspective, its really mixed signals now, so confusion. The Yields kept rising yesterday - not good. The Dollar Index fell - one of the possible reasons indices gained yesterday. Volatility index VIX fell slightly, still above 24, so still close to neutral zone. It has been falling for last few days but some analysts feel a bottom is forming.
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There are also mixed opinion of analysts. Some feel another attempt at 3900 on SP 500, others feel the 3800 level may form another lower high. The mid-term elections in US today, it may give some short-term direction. But the main event is on Thursday - the CPI data. I think close to 90% of the time the forecast figure has come low and actual above that - so a sell off has mostly happened on the outcome - something to keep in mind for those risk averse.

Personally I did have some trades, switching around those not doing well, including from announcements, to those steady or looking better.

So what will happen tonight? US futures slight red. Asian markets mixed. Cryptos collapsing, Bitcoin back to 19 to 20k range - some news. No major data tonight. Election news could provide most direction. Sentiment is still on Greed. Though 2022 is different, but in previous time the mid-term elections have provided an event for a rally. Will that happen this year too? Lets hope so. All the best.