The Morning Call
8/14/20
The
Market
Technical
The Averages (27896, 3373) sold off yesterday, again probably
reflecting the negative factors that I have been listing over the last week:
(1) both of the indices made two gap up opens last week that need to be filled,
(2) the VIX continues to reflect investor concern and (3) breadth remains in
overbought territory. So, some downside/consolidation
seems probable although it still may not occur until the Averages (or, at
least, the S&P) challenge their all-time highs (29568/3393). Nonetheless, I am sticking with my assumption
that the Market’s bias remains to the upside long term.
Gold partially recovered
from Tuesday’s shellacking, remaining in the uptrend off its June low but still
not closing that that huge gap down open.
On the other hand, TLT got whacked again, finishing below its 100 DMA
(now support; if it remains there through the close on Monday, it will revert
to resistance. While its long term chart
is strong, as I noted yesterday, this pin action is the first sign of technical
weakness and could be sending a signal of rising rates/inflation. The
dollar was down again but not enough to close last week’s big gap up open.
30 Year auction
bombs.
https://www.zerohedge.com/markets/treasuries-tumble-after-dismal-30y-auction-shocks-traders
Dollar sensationalism.
https://www.project-syndicate.org/commentary/dollar-decline-exaggerated-by-barry-eichengreen-2020-07
Thursday in the
charts.
https://www.zerohedge.com/markets/bonds-stocks-battered-after-bombed-auction-silver-soars
Fundamental
Headlines
The
Economy
US
July retail sales
rose 1.2% versus estimates of 1.9%; ex autos, they were up 1.9% versus 1.3%.
https://www.zerohedge.com/markets/electronics-spending-sends-us-retail-sales-soaring
Q2 nonfarm
productivity was up 7.3% versus consensus of up 1.5%; unit labor costs were
also up 12.2% versus up 6.2%
International
The June EU trade
balance was E21.1 billion versus expectations of E12.6 billion; Q2 GDP fell
12.1%, in line, employment declined 2.8% versus -1.7%.
July Chinese YoY
industrial production came in at +4.8% versus forecasts of +5.1%, retail sales
were -1.1% versus +0.1%, fixed asset investment was -1.6%, in line; July
unemployment was 5.7%, also in line.
Other
The economy is re-knitting itself.
https://www.washingtonexaminer.com/opinion/the-economy-is-reknitting-itself-so-leave-it-alone
As of August 8th, hotel occupancy
is down 33% YoY.
https://www.calculatedriskblog.com/2020/08/hotels-occupancy-rate-declined-33-year.html
The
coronavirus
***overnight update.
More from Sweden.
The
Fed
The money illusion.
https://www.themoneyillusion.com/the-bubble-century/
The Fed is considering direct money transfers.
In transformational
shift, the Bank of Japan starts unwinding its negative interest rate
policy (must read).
China
US/China trade stalled in June.
China fears of currency decoupling rise.
Bottom
line. An end to central banks’ inflationary policies
is not in sight.
https://www.zerohedge.com/political/gold-prices-show-theres-big-short-going-official-currencies
Thoughts on current retail trading.
https://www.epsilontheory.com/cant-fight-this-feeling/
For the optimists (must read).
http://blog.yardeni.com/2020/08/another-roaring-twenties-may-be-ahead.html
News on Stocks in Our Portfolios
What
I am reading today
Expiring
versus permanent skills.
https://www.collaborativefund.com/blog/expiring-vs-permanent-skills/
Waging
war against the Constitution.
Tax guide for working at
home.
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