The Morning Call
4/4/16
The
Market
Technical
Monday Morning Chartology
The
S&P had a great week, remaining within a very short term uptrend, above its
100 day moving average (though this MA continues to decline) and is nearing a
challenge of the upper boundary of its short term trading range. The ball is in the bulls’ court to bust that
trading range.
The
long Treasury gained some traction last week, breaking a very short term
downtrend, then forming a very short term uptrend. It remains well above its 100 day moving
average and the lower boundary of its short term uptrend
Gold
continued to consolidate. Short term, it
still looks good; but it needs to break that very short term downtrend and hold
above the 114 support level.
The
dollar has fallen to the lower boundary of a two year consolidation phase---which
has roughly coincided with the sideways move in stocks. If this relationship holds, then a break
below the support level (weaker dollar) would be a plus for stocks.
The
VIX took in the snoot last week and on Friday.
It remains in a very short term downtrend and below its 100 day moving
average (though notice this MA is not moving lower). At 13, it is clearly close to an attractive
level (10-12) to buy portfolio insurance.
Fundamental
I
noted in the Closing Bell on Saturday that the data trend in the industrial
sector over the last couple of weeks has been surprisingly upbeat and that this
could be an early signal that the worst of this slowdown is over. However, I had failed to see the Friday afternoon
release from the Fed, revising industrial production stats downward. Here are the numbers (medium):
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