The Morning Call
5/11/20
The
Market
Technical
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.
Fundamental
Headlines
***overnight
update on coronavirus.
News on Stocks in Our Portfolios
Economics
This Week’s Data
US
International
April
Chinese loan growth was +13.1% versus estimates of +12.9%.
Other
The
Saudi’s cut oil production another million barrels a day.
What
I am reading today
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