Country Garden is unable to meet the offshore debt payments

The past few days were quite choppy for SPX. However, S&P 500 E-mini Futures have not broken above the 0.5 Fibonacci retracement level. That allows us to maintain a bearish stance and keep the recently introduced setup valid. As a result, there is not much to write about today, except for one noteworthy thing that caught our attention overnight: one of the largest Chinese real estate developers, Country Garden, failed to meet offshore debt payments (already in the grace period), suggesting default proceedings might be next. We will update our thoughts on the asset with the emergence of new developments.

Illustration 1.01

Illustration 1.01 displays the daily chart of ES1! and Fibonacci retracement levels.

Technical analysis gauge
Daily time frame = Neutral
Weekly time frame = Slightly bearish
*The gauge does not necessarily indicate where the market will head. Instead, it reflects the constellation of RSI, MACD, Stochastic, DM+-, ADX, and moving averages.

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DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.

Comment:

Some of the corporations reporting their earnings today include:

- Abbott Laboratories
- AMSL Holding
- Kinder Morgan
- Morgan Stanley
- Netflix
- Procter & Gamble Co.
- Tesla
- U.S. Bancorp

Comment:

Chinese stock market began selling off heavily overnight, likely presenting trouble for U.S. stocks as well.

Comment:

VIX hit the highest value since late March 2023, a warning that the sentiment is quickly deteriorating.