Tuesday, January 16, 2018

Tuesday Morning Chartology

The Morning Call

1/16/18

The Market
         
    Technical

            The refrain is the same:  up, up and away.  The assumption is that there is more to come.

                Euphoriameter (medium):



            The decline in TLT (higher rates) accelerated following the low PPI number (suggesting the Fed could be more aggressive raising rates); but that proved to be a one day phenomena.  However,  that leaves the long Treasury in sort of a no man’s land---in a very short term downtrend and below its 100 day moving average but above its 200 day moving average and the lower boundaries of its short term trading and long term uptrend.  In other words, basically directionless; so I await a move breaking one of these two barriers.

            Japanese purchases of US Treasuries tumble (medium):

            China takes another shot in anticipation of a trade war with the US (medium):



            The dollar experienced a minor uptick when the PPI stat was released (higher US rates usually means a stronger dollar).  But then it was hammered the rest of the week---which suggests that currency investors are betting on a continuation of the Fed’s accommodative policy.  Clearly, it is supporting the equity theme.  As you can see, it is now approaching the lower boundary of its long term trading range.  A break of that boundary would suggest more serious downside price action.



            GLD was hardly phased by the threat of higher interest rates.  It beat a one day retreat then continued a strong very short term performance.



            This VIX chart is not what you would expect to see at a time that the Market is on a moon shot.  It looks like it has uncoupled for the traditional inverse relationship with equities.  I don’t think that is necessarily a bad thing for stocks, directionally speaking; but it certainly suggests that 2018 will be a much more volatile year than 2017---that is the moves in both directions are likely to be more pronounced.



    Fundamental

       Headlines


      Subscriber Alert

            Microsoft (MSFT-$89) has traded into its Sell Half Range.  According, at the Market open today, the Aggressive Growth Portfolio will Sell one half of its position.

Economics

   This Week’s Data

       US

            The January NY Fed manufacturing index was reported at 17.7 versus expectations of 19; however, the December number was revised upward.

        International

            December UK CPI was in line.

   Other

            Update on big four economic indicators (medium):

            The Fed paying banks not to lend (medium):

            How much economists don’t know (medium):

            David Stockman on the real s**thole economy (medium):
           
What I am reading today

            What really happened in Iran (short):

            Calculating your paycheck after the tax cuts kick in (medium):
               
Doing nothing.

            Outlook for oil production in 2018 (short):

                Quote of the day (short):


                More on the modernization drive in Saudi Arabia (medium):

                        US inequality chart book (short):


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