Tuesday, February 18, 2020

Tuesday Morning Chartology

The Morning Call


The Market

            The S&P maintained its upward momentum last week. (The Dow didn’t do quite as well; but still managed to re-establish is very short term uptrend.)  The assumption is that the uptrend continues, possibly challenging uptrends marked up the upside by 32301/3594.

            The long bond recovered from the earlier in the week sell off, is in the process making a higher low.  That is a technical plus and points to a continuation of upward momentum.

            GLD continues its winning ways.  As you can see, last week it made a new higher low and a second higher high, suggesting that investors are pursuing safety trades.

            The dollar’s performance since year end 2019 has been impressive---virtually a straight shot up.  Thursday, it closed above the upper boundary of its short term downtrend; and even though, UUP ended down on Friday, it remained above this boundary.  If it finishes there at the close today, the short term trend will reset to a trading range.  Its pin action could suggest either a strong economy (ala stocks) or a safety trade (TLT and GLD).

As should be expected, VIX moved lower last week as stocks rallied.  Friday, it ended back below its 100 DMA (now support; if it remains there through the close on Wednesday, it will revert to resistance) and below its 200 DMA for a third day (now support; if it remains there through the close today, it will revert to resistance).  Nonetheless, the magnitude of move to the downside did not mirror stocks move to the upside, suggesting the investors are more risk averse than the indices pin action would indicate.



            The article is a bit long but it delves into the math of buy backs and how they contribute to the mispricing and misallocation of assets.

            Summary data on Q4 earnings.

            The next Minsky moment.

            Chinese government appears to be nixing another round of fiscal stimulus.

            Apple gets whacked by the coronavirus.

            What makes an asset safe?

    News on Stocks in Our Portfolios
Illinois Tool Works (NYSE:ITW) declares $1.07/share quarterly dividend, in line with previous.

Genuine Parts (NYSE:GPC) declares $0.79/share quarterly dividend, 3.6% increase from prior dividend of $0.7625.


   This Week’s Data


            The February NY Fed manufacturing index was reported at 12.9 versus expectations of 5.0.


            Q4 Japanese GDP growth fell 1.6% versus estimates of -0.9%; capital expenditures  were -6.3% versus -3.7%; private consumption was -2.4% versus -2.0%.

            December Japanese industrial production rose 1.2% versus consensus of +1.3%.

            The December UK unemployment rate was 3.8%, in line; average earnings rose 2.9% versus +3.0%; Q4 productivity was up 0.3% versus +0.2%.

            February EU economic sentiment came in at 10.2 versus forecasts of 30.0;

            February German economic sentiment registered 8.7 versus estimates of 21.5.


            Different perspectives on the Atlantic alliance.

What I am reading today

            Knowing your limits.

Visit Investing for Survival’s website (http://investingforsurvival.com/home) to learn more about our Investment Strategy, Prices Disciplines and Subscriber Service.

No comments:

Post a Comment