The Morning Call
10/24/16
The
Market
Technical
Monday Morning Chartology
While
the S&P has reset to a short term trading range and successfully challenged
its 100 day moving average, reverting to resistance, there has been no real
follow through to the downside. As I have
been repeating for the last month, stocks appear to be stuck in a very tight
range probably a result of the lack of clarity on a number of fundamental
issues.
TLT
spent the week in a very narrow range (much like stocks and gold). On the positive side, it has remained well
within uptrends across all major timeframes and it held above a key Fibonacci
level. The bad news is that it has
pushed through its 100 day moving average with authority and is developing a
very short term downtrend. At the
moment, the chart is sound (suggesting higher prices) though it is developing
some warts.
You
can see that the dollar is on a sizz.
That is not good for gold, the US trade balance or US based companies
with a large international exposures.
Even
though GLD has busted to the downside through its 100 day moving average and
has reset to a short term downtrend, it has held above a key Fibonacci
level. That is a start; but just
only. The pin action needs to improve a lot
more before I start getting enthusiastic about GLD.
The
VIX got pummeled last week, including being down on down Market days. It is now below its 100 day moving average
(resistance) and in a short term downtrend.
However, it is also in a very short term uptrend which has been set by
five higher lows---a good sign of strength at lower levels. As you can see, the VIX is again nearing that
trend line. If it holds, that would be a
sign that stocks are about as good as they are going to get.
Fundamental
Headlines
Goldman
cuts S&P earnings outlook (medium):
Investing for Survival
Ten
purchases that are worth the money.
News on Stocks in Our Portfolios
Revenue
of $4.59B (-2.8% Y/Y) misses by $140M.
Revenue
of $3.49B (-1.1% Y/Y) misses by $140M
AT&T (NYSE:T): Q3 EPS of $0.74 in-line.
Revenue
of $40.89B (+4.6% Y/Y) misses by $260M
Economics
This Week’s Data
The
September Chicago national activity index came in at -.14; August was revised
from -.55 to -.72.
***overnight,
the October EU Markit manufacturing, services and composite PMI’s were all
better than expected as was the Japanese October manufacturing PMI; October
Japanese exports fell.
Other
Politics
Domestic
International
The US/Russia relations continue to
deteriorate (medium):
Iraq wants exemption from OPEC
production cuts (medium):
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