The Morning Call
2/14/19
The
Market
Technical
The Averages
(DJIA 25543, S&P 2753) staged a solid follow through from Tuesday’s big day. Their pin action versus their MA’s are
getting back in sync: the Dow ended above
its 100 DMA for the second day (now resistance; if it remains there through the
close today, it will revert to support) and above its 200 DMA; the S&P is
above its 100 DMA (now support) and above its 200 DMA (now resistance; if it remains
there through the close on Monday, it will revert to support). In addition, both re-established very short
term uptrends. The next resistance levels
that I am watching are their previous lower highs (~25977, 2800).
However, volume
was lower volume and breadth mixed.
The VIX rebounded
1 ½% (not usual for a convincing up Market day), bouncing off the lower
boundary of its short term uptrend. But
it remains below both MA’s (now resistance).
The long bond
was down, but finished above both MA’s, in short and intermediate-term trading
ranges. However, it ended below the lower
boundary of its very short-term uptrend; if it remains there through the close
today, the trend will be voided.
The dollar was
up ½%, finishing above both MA’s, in a short-term uptrend and above the upper boundary
of its mid-November to present consolidation phase---suggesting renewed
momentum to the upside.
GLD declined but
its chart remains strong, closing above both MA’s, within very short-term and
short-term uptrends.
Bottom line: the Averages had another
good day, resetting their very short term uptrends. So, upside momentum seems to have been
re-established---a little more follow through is needed to be convincing. Their next challenge is surpassing their prior
lower highs.
The dollar, bonds and gold seem to be
attracting ‘safety trade’ investors even though their daily activity is not
always consistent.
Wednesday in the
charts.
Corporations
continue to be big buyers of their own stock.
Fundamental
Headlines
Yesterday’s
economic data again tilted negative: weekly mortgage applications and purchase applications
were down, the December budget deficit was larger than expected but January CPI
unchanged.
Overseas, December
EU industrial production fell more than anticipated.
Otherwise a relatively
quiet day.
Bottom line: the
dataflow continues to support the proposition that the US economy is slowing and
that the global economy may be in danger of going into recession. However, Markets seem more focused on the potential
easing in monetary policy by the major central banks---and small wonder. QE’s have been a boon to asset prices for a
decade. So, expectations seem to be that
this time monetary easing will have a similar impact.
If so, then I will
be watching our Portfolios’ stocks should any trade into their Sell Half Range
and act accordingly.
News on Stocks in Our Portfolios
Sherwin Williams (NYSE:SHW) declares $1.13/share quarterly dividend, 31%
increase from prior dividend of $0.86.
Revenue of $7.1B (-5.5% Y/Y) beats by $30M.
Economics
This Week’s Data
US
And.
Plus,
the government is not the only one getting in over its head.
Weekly
jobless claims rose 4,000 versus consensus of -9,000.
January
PPI fell 0.1% versus projections of +0.2%; ex food and energy, it rose 0.3%
versus expectations of up 0.2%.
December
retail sales declined 1.2% versus expectations of a 0.1% increase; ex autos,
they dropped 1.8% versus estimates of no change.
International
Q4
EU flash GDP showed growth of 0.2%, in line; the German flash GDP was flat versus
forecasts of +0.1%.
January Chinese exports
jumped 9.1% versus an anticipated decline while imports fell 1.5%.
Other
A
trade war win may not be all that great for the Market.
Update
on Bank of China liquidity operations.
Baltic
Dry Index collapsing.
What
I am reading today
Quote
of the day.
How to wreck a
pension plan in three easy steps.
Libertarian fantasies about
cryptocurrencies
Why
we lie.
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for Survival’s website (http://investingforsurvival.com/home)
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