Monday, March 28, 2016

Monday Morning Chartology

The Morning Call


The Market

       Monday Morning Chartology

            The S&P sold off but not that much---given the extreme overbought condition at the end of last week.  That is good news along with the facts that it (1) has busted above numerous resistance levels and remains above visible support [100 day moving average and a Fibonacci support level.  The bad news is that most of the advance was on low volume and not particularly great breadth.  Plus, very short term, it has voided an uptrend.  The assumption has to remain that it will challenge its all-time high until/unless it negates the aforementioned support levels.

            The long Treasury acted very well this week.  It stabilized after a six week decline, voiding a very short term downtrend and holding above a key Fibonacci support level---not the kind of pin action you would expect in a week in which three Fed officials trumpeted the need for additional rate hikes.

            GLD underwent more consolidation this week.  It remains well within a short term uptrend and above its 100 day moving average.  However, there is no visible near in technical support, so there could be more downside.

            The VIX basically supported the above observations on the S&P.  It could not rally sufficiently to void a very short term downtrend.  Any move to the 10-12 level would represent an opportunity to buy portfolio insurance inexpensively.


            ***overnight, China reported an increase in industrial profits in February; however, the New York based China Beige Book reported capex at its lowest level in the history of the survey (five years) and employment at a four year low.

            Update on Buffett indicator (short):

       Investing for Survival
            Investor self-deception.

    News on Stocks in Our Portfolios
AT&T (NYSE:T) declares $.48/share quarterly dividend, in line with previous.
Forward yield 4.94%


   This Week’s Data

            The January US trade deficit was $60.0 billion versus expectations of -$62.5 billion.  However, its makeup was not so hot: exports were down 2.9% while imports were down 1.5%.

            February personal income rose 0.2% versus estimates of up 0.1%; spending was up 0.1%, in line; the PCE deflator was -0.1%, also in line.


            Here is a breakdown of the fourth quarter GDP number reported Friday morning (medium):

            Another thought on the trade deficit (short):



The GOP governors at a brokered convention (medium):

Another Obama false equivalency (medium):

The absurdity of feigned offense has reached a new high (medium and a candidate for Monday morning humor if it weren’t so tragic):

  International War Against Radical Islam

            Marines enter combat in Iraq (short):

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