The Morning Call
&
the top eight must read articles
11/10/25
The
Market
Technical
The S&P was down on the week. And while
trading intraday Friday below that very short term uptrend off of the May low,
it bounced off its 50 DMA and closed right on that trend line. And as long as
it stays above that trend line, it is in a rising wedge which is historically
positive for equities. In addition, the S&P remains above all three DMAs,
in uptrends across all timeframes and is moving into the most positive seasonal
time of the year. On the other hand, breadth has been abysmal. The index is now
at a critical short term technical junction; and follow through is the key.
All in all, I
remain of the opinion that this is a market to trade not invest in long term.
If you do, be sure to have close in stops.
https://www.zerohedge.com/markets/repo-ripples-ai-angst-bad-breadth-stealth-qe
***given the news that the shutdown may end
soon and as a result the likelihood of a rush of liquidity back into the
financial system, we may get a temporary reprieve.
Was
Friday the trading low?
https://www.zerohedge.com/the-market-ear/hammer-time-fridays-fear-flush-may-have-marked-low
Why a little known
indicator should worry investors,
The latest from
Goldman.
The TLT held on to
that very short term uptrend---though just barely. It finished down on the week
and is now testing its 50 DMA (now support; if it remains below that DMA on the
close today, it will revert to resistance). While it is still above its 100 and
200 DMAs, it is in downtrends across all time frames and has yet to mount a
serious challenge of the upper boundary of its short term downtrend. I wouldn’t
bet heavily on a change of direction until that threshold is breached.
Gold managed to
gain some stability on the week, halting a rather aggressive selloff. The good
news is that it remains above all three DMAs and in uptrends across all
timeframes. The bad news, at least in the short term, is that it remains grossly
overextended to the upside. So more consolidation would not be surprising. I am
still contemplating re-establishing my trading position in GDX, but gold is going
to have to show more life before I do.
Gold
consolidates amidst cautious sentiment.
Gold wakes
up.
https://www.zerohedge.com/the-market-ear/gold-wakes-big-sellers-flushed-out-puke
The dollar had another good week, managing to hold above
its 200 DMA and remaining above its 50 and 100 DMAs. So it appears that the
worst is over. But I will hold off on that call until we get more data on
inflation and the credit problem.
Friday in the
charts.
More charts.
https://www.zerohedge.com/the-market-ear/miss-markets-mood-18-charts
Five more charts
to consider.
https://www.zerohedge.com/the-market-ear/teen-growth-and-double-club
Friday in the
technical stats.
https://www.barchart.com/stocks/momentum
https://www.barchart.com/stocks/sectors/rankings
https://www.barchart.com/stocks/signals/new-recommendations
Fundamental
Headlines
The
Economy
Despite the continuing
government shutdown, there was a decent flow of stats from nongovernment
sources last week. What was produced was slightly negative with no inflation
data. Overseas, the indicators were marginally upbeat though there was one
negative inflation number.
So, my ‘muddle
through’ forecast remains on hold, though the chorus of naysayers is gaining
strength. As does the ‘inflation is as good as it is going to get’ call; but
here again, the debate over the likelihood of rising prices is growing louder---which
like last week is breathing more strength in my confidence level.
I think the main takeaway
from last week was the aforementioned intensification of recession/inflation
debates---made worse by (1) the fallout from the government shutdown, (2) the sudden
advent of uncertainty around the long term economics surrounding AI and (3) the
mounting concern over the strength/weakness in the credit markets. Whether or
not the US ultimately suffers a recession/higher inflation, the credit markets
break and/or the trillions being poured into AI produce the returns that many
have bet on, the immediate result of this was a weakening in investor
confidence.
How long this lasts
is anyone’s guess. But my yellow light is flashing. So, until we get some clarity,
caution is a virtue.
US
International
The September
Japanese leading economic indicators came in at 108.0 versus estimates of
107.7.
Other
The week ahead.
ECONOMC
WEEK AHEAD: November 10-14
Results
of NY Fed consumer survey.
Wholesale used car prices declined in October.
https://www.calculatedriskblog.com/2025/11/wholesale-used-car-prices-declined-in.html
Interpolating October employment.
https://bonddad.blogspot.com/2025/11/october-employment-situation-stagnant.html
Monetary
Policy
Fed likely to remain divided on the need for rate
cuts.
https://www.nytimes.com/2025/11/07/business/federal-reserve-divided.html
Fiscal
Policy
Looks like the shutdown is about over.
Why we can’t trust the economy to economists.
More nonsense from our ruling class.
https://marginalrevolution.com/marginalrevolution/2025/11/creative-stagnation.html
Why starving the beast (government spending) feeds it instead.
https://thedailyeconomy.org/article/why-starving-the-beast-feeds-it-instead/
Trump announces
$2000 dividend for each American---that ought to help his poll numbers.
https://www.zerohedge.com/political/trump-announces-2000-tariff-dividend-be-paid-most-americans
Investing
The best way to
describe the AI market.
https://www.ft.com/content/8e21d389-64bb-42cc-b52d-48203837979f
AI intelligence:
Nirvana or apocalypse.
https://mathinvestor.org/2025/11/artificial-intelligence-nirvana-or-apocalypse/
Will longer rainbows
lead to bigger pots of gold?
https://www.lpl.com/research/blog/ai-theme-longer-rainbows-should-lead-to-bigger-pots-of-gold.html
Layoffs probably
not the result of AI.
https://www.nytimes.com/2025/11/07/business/layoffs-ai-replacement.html
Watch leverage and liquidity.
https://www.ft.com/content/f142e341-c618-42e6-8f45-46aa60d42e41
The
latest from Howard Marks.
https://www.oaktreecapital.com/insights/memo/cockroaches-in-the-coal-mine
The latest from BofA.
https://www.zerohedge.com/markets/hartnett-ai-bubble-watch-out-metric-just-snapped
News on Stocks in Our Portfolios
EOG Resources (EOG) declares $1.02/share quarterly dividend.
What
I am reading today
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