Article Category: Momentum

It’s Retest Day

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I’ve been sitting here parsing through all kinds of economic data trying to make the case for a bear market, and I’ll be honest – it’s tough. There just aren’t many data points that portend a rolling over of the business cycle, or primary trend.

There are of course a few, such as the declines in housing starts and building permits (shown below), but other than that, most leading indicators remain in firm uptrends (the S&P 500 being the notable exception).

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Posted in: Corrections Economy Momentum Primary Trend Stocks

Approaching Major Resistance

For the last few months, we've been commenting on the "stealth" nature of this bull market. While most investor attention has been focused on the major averages, which have been laying low, many of the junior indexes have taken out their high-water marks. That left us with the impression that the majors would soon follow.

The list of indexes that have climbed to new highs following the February swoon is quite exhaustive.

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Posted in: Bonds Corrections Interest Rates Market Breadth Momentum

Stop Looking at the Industrials

Trade wars be damned. The U.S. economy is strong, and if your focus remains on a possible dismantling of global trade, you're missing the bigger picture.

One of the reasons the average investor may have a distorted view of what's going on in our economy is because the stock index most closely watched by the average Joe is the Dow Jones Industrial Average. Anytime you turn on evening news - or even CNBC for that matter - this average gets the most publicity.

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Posted in: Corrections Earnings Economy Federal Reserve Momentum

Correction Update

Back in early February, in the midst of the most vicious selloff we've seen in years, I showed the chart below and made the case that we were seeing a "minor blow-off top in the context of a continuing primary bull market." Today I'd like to update you on that view.

My February comments were based on two main factors: we had just experienced a two-month long explosive momentum-based rally, and the economy remained on steady footing. The combination of these factors left me with the impression that stocks would eventually work themselves higher, but it would take a while. I did not, however, expect it to take quite this long...

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Posted in: Corrections Economy Gold Momentum Primary Trend

Charts Galore

As someone who studies the markets on a daily basis, and writes about them frequently, sometimes I get tired of talking ... or rather, writing. So today, I'm going to allow charts to do most of the talking, with some comments thrown in where needed.

As they say, a picture is worth a thousand words ... so get ready for at least 12,000 words of wisdom, not including the nonsense that comes out of my mouth, of course.

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Posted in: Economy Federal Reserve Inflation Momentum

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