Monday, October 13, 2014

Monday Morning Chartology & Subscriber Alert

The Morning Call

10/13/14

The Market
           
    Technical

       Monday Morning Chartology

            The S&P remains within a very short term downtrend.  It also closed right on the lower boundary of its newly re-set short term trading range as well as its 200 day moving average (red line).  If the S&P confirms a break of these two support levels, it is a long way to the next support level (1739)---which I would note is still well above Year End Fair Value (1480).  It also finished below the lower boundary of its intermediate term uptrend for the second day.  If it trades below this trend line thru the final bell on Tuesday, it will confirm the break.



            On Friday, TLT’s break of its short term trading range was confirmed.  It re-sets to an uptrend.  It remains within a very short term uptrend, above its 50 day moving average and within an intermediate term trading range.  The long Treasury as well as the dollar both seem to be signaling that the US government bond market is being viewed as a safe haven.


            GLD is making an All American try to rally.  It bounced in text book fashion off the lower boundary of its long term trading range; but so far, remains within very short term, short term and intermediate term downtrends.  Until one of these downtrends is broken, GLD will remain an ugly chart.



            The VIX remained within its very short term up trend and above its 200 day moving average.  Based on the distance element of our time and distance element, it has re-set its short term trend from down and a trading range.  It finished within its intermediate term downtrend.  All of this is negative for stocks.



    Fundamental
 
            S&P lowered the credit rating of France.

            Monday morning humor (short):

                What keeps Jamie Dimon up at night (medium/long)?

                The latest from John Hussman (medium):

       Investing for Survival

            Global diversification (medium):
  
       Subscriber Alert

            As I pointed out numerous times as the Averages were making new highs, our internal indicator tends to lead the Market, sometimes by too much.   In the last couple of weeks, the general price weakness is showing up in the form of some of our stocks starting to trade in their Buy Value Range.  Not a lot mind you; certainly not a sign that a bottom is near.  But there are areas within the Market that have seen declines of 15-20%. 

            So it is not unusual that some of our stocks are nearing Buy levels.  I am Adding these names to our Buy Lists; but I am not even considering Buying them.  If am simply reflecting the results of our Price Discipline.

            In the Dividend Growth Buy List, I am Adding ITC holdings (ITC-$$35), South Jersey Industries (SJI-$54) and Chevron (CVX-$114).  In the Aggressive Growth Buy List, I am Adding Balchem (BCPC-$52), Donaldson (DCI-$39) and Cummins Engine (CMI-$131).  Again I am not taking any action at this time.

      News on Stocks in Our Portfolios
 
Economics

   This Week’s Data

   Other

            Recent data on household deleveraging (medium):

            The latest from Mohamed El Erian:  Why the Fed is thinking global (medium):

            Freight rates plunging (short):

Politics

  Domestic

  International War Against Radical Islam

            ISIS enters Baghdad suburb (medium):

                ISIS on the Turkish front (medium):







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