Tonight's U.S. market will determine — Mr. Tetsuo Inoue

Trend 995: Technical 6-Graph and TB Graph 2Publication date: 2020/03/09 08:59

As noted in "MD", due to the weekend New York City state of emergency declaration, the sharp drop in crude oil, and the ongoing dollar weakness (yen appreciation) (currently around 103.76 yen per dollar), in US after-hours trading all three indices are down about 4% from Friday's close, and the three-week-old sell-off driven by the coronavirus is in an extremely unstable state as to how tonight's US market will unfold.

Option volatility peaked (the unwind peak) at the Osaka Evening Session on the night of Fri 2/28, when the Nikkei Average closed 805 points lower, and has gradually declined since, but today and tomorrow it is unlikely to avoid rising again.

Earlier, during this drop, the declines in Microsoft and Apple over six and seven days were 15.5%, and applying that to the Nikkei Average would suggest around 20,184 yen; however, if we measure from the Friday close and from the declines prior to 2/24 in the Dow from 2/19, they are 16.73% and 10.69%, respectively, and the situation hasn't changed much. The Dow is also 11.87%. Considering that, the current 4% intraday drop is an extremely serious figure.

Today, as with last weekend, I attach all the graphs I am monitoring; the only current fact is that TB (U.S. Treasuries) have seen a large drop in yield in one day since Friday. However, the bottoming process seen in RSI and the three-deviation divergence remains unchanged.

Inoue Tetsuo 'Market Trends'