Monday Morning Chartology

The Morning Call

8/28/17

The Market

         

    Technical

            From a long term perspective, the S&P remains above its 100 and 200 day moving averages and within uptrends across all timeframes; and that carries the most weight.  However, its short term price performance has gotten a bit squirrelly.  Notice that (1) it is now in a rapidly narrowing pennant formed by the lower boundary of its short term uptrend and the upper boundary of a developing very short term downtrend, (2) if it can’t get above the marked 2454 level, it will have developed the right shoulder of a head and shoulders formation.  None of this means anything unless and until these potentially adverse short term patterns actually play out to the negative.  At the moment, it is just something to watch.

            The long Treasury continues to rise (decline in yield), closing above its 100 and 200 day moving averages and the lower boundaries of its short term trading range and long term uptrend.

           

            Gold rose on good volume, ending above its 100 and 200 day moving averages and in a very short term uptrend---it challenged the lower boundary of that uptrend intraday on Friday but bounce hard closing right under the upper boundary of its short term trading range.

            The dollar took in the snoot on Friday.  It finished below its 100 and 200 day moving average and the upper boundary of its very short term downtrend.  Further, it closed right on the lower boundary of its short term trading range.  If it breaks that level, there is no real support short of its 2014 low (3% lower).

            The VIX got whacked big time last week, ending below the upper boundary of its short term downtrend, its 100 day moving average (now support; if it remains there through the close on Tuesday, it will revert to resistance) and its 200 day moving average (now support; if it remains there through the close on Wednesday, it will revert to resistance).  However, it is still in a very short term uptrend.  I still think that the question is, has the VIX made a bottom?

    Fundamental

       Headlines

            A different look at corporate profits (short):

            http://www.businessinsider.com/stock-market-news-earnings-growth-bull-market-pillar-crumbling-2017-8

            More on valuations (medium):

            http://www.zerohedge.com/news/2017-08-26/these-4-charts-show-why-you-should-run-away-sp-500

            ***overnight, the Bank of Japan said that it would maintain its accommodative monetary policy; August Chinese industrial profits increased but at a slower pace than anticipated.

       Investing for Survival

   

            Questions to ask your financial advisor.

            http://ritholtz.com/2017/08/zweig-questions-ask-financial-adviser/

    News on Stocks in Our Portfolios

 

Economics

   This Week’s Data

            July US exports fell 1.3% while imports were down 0.3%.

            July retail inventories declined 0.2% versus the June reading of +0.6%; wholesale inventories rose 0.4% versus the prior reading of +0.6%.

   Other

Politics

  Domestic

Quote of the day:

http://cafehayek.com/2017/08/quotation-of-the-day-2177.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+CafeHayek+%28Cafe+Hayek%29

Nuclear fusion breakthrough (medium):

http://www.zerohedge.com/news/2017-08-27/researchers-announce-nuclear-fusion-breakthrough

  International

            US diplomats suffer brain damage in Cuba (medium):

            http://www.zerohedge.com/news/2017-08-25/mystery-deepens-after-us-confirms-16-diplomats-suffered-traumatic-brain-injury-cuban

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