The S&P had a good week, closing above its 4/17 high (as did the DJIA) and right at the 4/29 high. Volume hasn’t been that great but breadth has; and the VIX (see below) is suggesting further upside. As you know, I believe that as long as investors believe in the Fed ‘put’, the bias is to the upside.
Following TLT’s rapid mid-March to mid-April advance, it has been consolidating. Given that it is trading above both DMA’s and the upper boundaries of long, intermediate and very short term uptrends, my assumption is that the current standoff will be resolved to the upside.
GLD’s chart is very similar to the long bond’s: (1) rapid mid-March to mid-April advance, (2) currently consolidating, (3) trading above both DMA’s and the upper boundaries of both short and very short term uptrends. So like TLT, my assumption is that the current standoff will be resolved to the upside.
The dollar’s chart approximately parallels those of TLT and GLD: (1) a rapid but much shorter rise off its March low, (2) currently consolidating but much further off the latest high, (3) trading above both DMA’s but within intermediate and short term uptrends. My assumption (though less strongly held) is that the current standoff will be resolved to the upside.
The air continues to come out of the VIX. It is now challenging its 100 DMA; if it remains below that trend line through the close on Tuesday, it will revert to resistance. Its pin action supports the upward bias in stock prices.
***overnight update on coronavirus.
News on Stocks in Our Portfolios
Illinois Tool Works (NYSE:ITW) declares $1.07/share quarterly dividend, in line with previous.
This Week’s Data
April Chinese loan growth was +13.1% versus estimates of +12.9%.
The Saudi’s cut oil production another million barrels a day.
What I am reading today
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