The Morning Call
5/4/22
The
Market
Technical
Tuesday in the
charts
https://www.zerohedge.com/markets/bonds-stocks-bid-ahead-fed-natgas-soars-2008-highs
Note: the S&P
closed below the lower boundary of its short term trading range (and the 23.6%
Fibonacci retracement level) for the third day. That signals a reset to a short
term downtrend---which I am doing. However, the weakness of the follow through
from the first day of the challenge suggests that this could be a false flag. And
as you can read below, breadth is so oversold that a bounce seems likely. The
point being: do not be surprised if this break is quickly negated.
Horrible breadth
suggests that the Market is oversold.
https://www.zerohedge.com/the-market-ear/cfvvaefpnq
Another excellent
piece from the Northman Trader (must read).
https://www.zerohedge.com/markets/unthinkable-0
Counterpoint---sort
of.
https://www.zerohedge.com/personal-finance/passive-behemoths-have-yet-awaken
Fundamental
Headlines
The
Economy
US
Weekly mortgage applications
increased 2.5% while purchase applications were up 4.1%.
Month to date
retail chain store sales grew much faster than in the prior week.
The March job
openings report (JOLTS) showed total openings of 11.5 million versus
predictions of 11.0 million.
March factory
orders rose 2.2% versus estimates of +1.1%; ex transportation, they were up 2.5%
versus +0.9%.
The April ADP
private payrolls report pointed out job increases of 247,000 versus expectations
of 395,000.
https://www.zerohedge.com/markets/adp-signals-weakest-job-gains-april-covid-lockdowns
International
The March German trade
balance was +E9.7 billion versus forecasts of +E9.5 billion; the final April
services PMI was 57.6 versus 57.5.
March EU retail sales
fell 0.4% versus consensus of -0.1%; the April final services PMI was 57.7, in
line.
Other
The ‘strong’ dollar is a relative thing.
Median household income in March.
Update on some business cycle indicators.
https://econbrowser.com/archives/2022/05/monthly-gdp-and-other-business-cycle-indicators
The era of ‘cheap and plenty’ may be over.
https://www.nytimes.com/2022/05/03/business/economy/pandemic-supply-chains-inflation.html
The
Fed
The Bank of England is expected to raise rates
to 13 year high this week.
Inflation
The hot housing market makes the Fed’s job
tougher,
Speaking of which, housing prices were up 20%
YoY in March.
https://www.calculatedriskblog.com/2022/05/corelogic-house-prices-up-record-209.html
And rents were not any better.
https://www.calculatedriskblog.com/2022/05/rent-increases-up-sharply-year-over.html
Geopolitics
An interesting background
discussion about the Ukraine/Russia conflict. It is a bit too conspiratorial for
me but a lot of the points mesh with what we already know.
Bottom
line
This does not
comport with the Earnings Tracker evidence that I linked to yesterday. Let’s
see who is right.
https://www.linkedin.com/feed/hashtag/?keywords=stockmarket
Thoughts
on the Market; the scale versus the casino.
https://alephblog.com/2022/04/28/the-scale-versus-the-casino/
The
familiarity bias.
https://www.evidenceinvestor.com/beware-the-lure-of-the-familiar/
The
inevitable end of bad advice.
https://www.zerohedge.com/markets/dont-be-bearish-inevitable-end-bad-advice
News on Stocks in Our Portfolios
What
I am reading today
Optimism
about the threat of nuclear war.
Big government
cheese.
https://www.adamsmith.org/blog/the-big-government-cheese
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for Survival’s website (http://investingforsurvival.com/home)
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