4/1/24
The Market
Technical
The S&P continued its advance, leaving all of
its uptrends and DMAs in support mode. So, the assumption has to be for
continued upward momentum. The only negative is that large gap up open below
that needs to be filled.
What are the odds of a five month winning streak.
Q1 Earnings Season Approaches - RIA
(realinvestmentadvice.com)
I continue to hold my IWN trading position.
The long bond failed to successfully challenge its
100 DMA after the prior Friday’s break up; however, it subsequently rechallenged
not only its 100 DMA but also its 50 and 200 DMAs. You can see that they are all pinched
together at virtually the same level. So, follow through to the upside would clearly
be a positive, directionally speaking, for the near term. On the other hand, TLT remains in downtrends
across all time frames and has made three preceding lower highs. I think that the fundamentals argue for a
retreat but this is a technical comment.
So, follow through.
GLD resumed its steep upward trajectory following
the break of its all-time high. The pin
action suggests more to come. The main negative is those two gap up opens that
need to be filled. As you know, I am becoming increasingly concerned about (long
term) inflation. I added to my small
position in GDX---the gold miners ETF.
The trend is your friend.
https://www.zerohedge.com/markets/gold-everything-hedge
Gold’s wild surge.
https://www.zerohedge.com/the-market-ear/golds-wild-surge-mastering-long
The dollar had another good week. Following the
reset of its short term trend in the prior week, UUP is now challenging its 100
DMA. It makes no sense to me for GLD and
UUP to be simultaneously as strong as they are.
So your narrator is confused.
The dollar rally is on borrowed time.
https://www.zerohedge.com/markets/dollar-rally-borrowed-time-us-disinflation-lags-world
Thursday in the charts.
https://www.zerohedge.com/markets/stocks-gold-crypto-soar-q1-despite-rout-rate-cut-expectations
Watch energy.
https://www.zerohedge.com/the-market-ear/energy-ascends-throne
Fundamental
Headlines
The Economy
Week
in review
Last week’s stats were upbeat for the second week
in a row (primary indictors were two up, one neutral). While not a trend, it could be the beginning
of one. Certainly, investors loved it.
Despite this, I still think that a recession is in the cards. And it will take more than a couple of weeks
of positive numbers to convince me otherwise.
The inflation data was relatively benign, fitting
my ‘inflation in the rear view mirror forecast’. That said, a runaway fiscal policy, a
historically dovish Fed and the recent performance of commodities (gold, oil)
and bitcoin have me starting to question whether or not inflation is as good
(low) as it is going to get. I am not
altering my call, but I am beginning to seriously consider it.
Bottom line:
(1)
the overall economic outlook remains unclear,
(2)
I am not altering my inflation forecast [i.e., inflation
in the rear view mirror] ---although I am beginning to contemplate it.
My primary concern
remains that an easing in monetary policy will only amplify the impact of a
grossly irresponsible fiscal policy which if left unresolved will ultimately
push interest rates and inflation to even higher levels, risking a tighter
monetary policy and impeding the economy’s ability to grow.
Are higher taxes the answer? Only if they are not spent on nefarious
projects---like they are now.
https://www.nytimes.com/2024/03/27/opinion/biden-tax-wealthy.html
(3) the question of
recession [what kind of landing] remains a bit murky, especially with the constant
downward revisions in the data. As you know, my forecast had been for some type
of growth problem which I have considered changing. But not yet.
The latest nowcast.
https://www.capitalspectator.com/us-q1-growth-nowcast-ticks-down-suggests-expansion-is-slowing/
US
International
Other
Recession
UK
confirmed in recession at year end 2023.
Bottom line
The case for cryptocurrencies.
News on Stocks in Our Portfolios
What I am reading today
Narrative fallacy.
https://ritholtz.com/2024/03/danny-kahneman-what-if-everything-is-narrative-fallacy/
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