AUGUST AND SEPTEMBER ARE USUALLY WEAKER MONTHS... I've made references to seasonal patterns in some recent messages. I'm referring mainly to monthly seasonal patterns. Chart 1 plots the percent of months the S&P 500 closed higher over the last ten years. Average percentage gains... READ MORE
GERMAN 10-YEAR BUND YIELD REACHES 18-MONTH HIGH ... The jump in European bond yields that started last Tuesday is continuing. A weak French auction of 30-year bonds caused bond prices in Europe to fall sharply which pushed yields higher. Ten-Year French and German yields jumped 10 and 9 basis points respectively.... READ MORE
Here is the July video recording for Market Round Up Live 2017-07-05. 2017-07-05 08.02 @Test Market Round Up Live With Martin Pring 2017-07-05 from StockCharts.com on Vimeo. Good luck and good charting, Martin J. Pring... READ MORE
* Watch those small caps * Dr. Copper about to get better? * Wheat enters a primary bull market * The yen is getting close to a downside breakout * Gold is close to a breakdown Watch those small caps Chart 1 features the iShares Russell 2000 ETF, the IWM, together with its relative strength... READ MORE
NARROWING SPREAD BETWEEN GLOBAL YIELDS HURTS THE DOLLAR... The U.S. Dollar has had a bad six months. And things got even worse this week. The driving force between currencies is the relationship between global interest rates. The 10-Year Treasury yield remains higher than foreign developed yields. The problem is... READ MORE
TECH SECTOR UNDERCUTS 50-DAY AVERAGE...STRESS TEST BOOSTS BANKS... Everyone in the media is suddenly talking about a rotation out of technology-dominated growth stocks into value stocks led by financials, healthcare, and (to a lesser extent) energy shares. We wrote about that on the day it started (June 9): "... READ MORE
TODAY IT'S THE BRITS TURNING HAWKISH... Yesterday it was hawkish comments from Mario Draghi that pushed eurozone bond yields sharply higher, and the rest of the world with them. Today it's hawkish comments by Mark Carney that the Brits may have to raise rates soon. Rising... READ MORE
* Technical condition poised for an upside breakout in the stock/Gold ratio * The significance for equities and gold from an upside or downside breakout. * Wither the tech stocks? Technical condition poised for an upside breakout in the stock/Gold ratio The ratio ($SPX:$GOLD) between the S&P 500... READ MORE
TEN-YEAR TREASURY YIELD HAS A STRONG DAY ... For the first time in weeks, bond yields are climbing. Chart 1 shows the 10-Year Treasury Yield climbing 7 basis points to the highest level in two weeks. A lot of that is following even bigger gains in Europe. French and German 10-year... READ MORE
LONG TERM COMPARISON OF CPI AND COMMODITIES... I wrote a message over the weekend examining the impact that full employment and commodity prices have had on CPI inflation. At the risk of overdoing it, I'd like to finish that article with two more charts. I made the bold... READ MORE
A HISTORICAL COMPARISON... A big debate is going on regarding the path of inflation. Inflation figures have slipped during the second quarter. So have commodity prices. Normally, falling commodity prices signal lower inflation. Fed economists argue that the current low unemployment rate should boost inflation. The Fed generally defines "... READ MORE
LONGER MATURITY BONDS ARE RISING FASTER ... We can often get clues about market sentiment by comparing different parts of the fixed income universe. A lot has been written about the falling yield curve, which plots the difference between 10-Year and 2-Year Treasury yields. That usually signals expectations for lower inflation.... READ MORE
* The long-term setting * Short-term considerations * Some individual currencies are vulnerable over the short-term * Conclusion The long-term setting A few weeks ago I pointed out that the Dollar Index ($USD) had violated its bull market trendline, as well as the 65-week EMA and 12-month MA, two key long-term smoothings. That type... READ MORE
HEALTHCARE IS GETTING A LOT STRONGER ... I continue to believe that healthcare is one of the best values in the stock market. And it's attracting a lot of investor attention. Chart 1 shows the Health Care SPDR (XLV) trading at a new record high after clearing its mid-2015... READ MORE
TECHNOLOGY IS NOT THE STRONGEST SECTOR ... Although a rebound in technology is getting the most attention, it's not the main reason that stock indexes are hitting new highs. Most of that credit goes to financials and healthcare. The daily bars in Chart 1 show the Technology SPDR (XLK)... READ MORE
CRB INDEX IS TRADING AT LOWEST LEVEL IN MORE THAN A YEAR... Ever since Wednesday's Fed rate hike, and the press conference by Janet Yellen, I've been thinking a lot about inflation. I believe the Fed is underestimating how weak inflation really is. I also believe... READ MORE
TEN-YEAR TREASURY YIELD FALLS BELOW 200-DAY AVERAGE... Expectations are for another Fed rate hike this afternoon. Bond yields, however, are falling sharply. Chart 1 shows the 10-Year Treasury Yield ($TNX) falling 9 basis points to the lowest level since last November. The yield has also slipped below its 200-day average... READ MORE
* Widespread dissemination of tech sell-off * Bears, not so fast * Not all tech sub groups experienced Friday’s selling spree * Commodities are down, but are they out? Widespread dissemination of tech sell-off In the last few days, we have seen a tremendous amount of financial media space alerting us to Friday&... READ MORE
* The head and shoulders that did not “work” * Inflation versus deflation sectors * Which are the financial sector stars? * Why financials matter The head and shoulders that did not “work” On this same date in May we published an article suggesting that financials could be an interesting area to monitor for... READ MORE
HEAVY PROFIT-TAKING IN TECHNOLOGY... An overbought technology sector is being sold heavily today. Chart 1 shows the PowerShares Nasdaq 100 (QQQ) tumbling in heavy trading. That's mainly big technology stocks. Chart 2 shows the Technology SPDR (XLK) looking just as bad. The FANG stocks are a big part... READ MORE
FINANCIAL SPDR TURNS SHARPLY HIGHER... Financial stocks are having a very strong day. Chart 1 shows the Financial Sector SPDR (XLF) surging to the highest level in a month and, in the process, clearing its 50-day average. That puts the XLF in position to challenge its spring highs. A decisive... READ MORE
TRANSPORTS CONTINUE TO GAIN... The daily bars in Chart 1 show the Dow Jones Transportation Average reversing higher today to continue its recent upturn. After finding support at its 200-day average during May, the TRAN rose above a three-month resistance line last week to signal its takeoff. It now appears... READ MORE
Here is the link to this months Market Round Up with Martin Pring for June 2017. Don't forget to use the HD button for better quality. Market Round Up Live With Martin Pring 2017-06-02 from StockCharts.com on Vimeo. Good luck and good trading, Martin J. Pring... READ MORE
STAPLES AND CYLICALS BOTH HIT NEW HIGHS... We can often get clues about stock market direction by watching shifting rotations among market sectors. In a strong market, stocks tied to the economy usually lead. In a correction, defensive stocks lead. But what are we to make of a situation where... READ MORE
FALLING BOND YIELD PUSHES YIELD CURVE LOWER... The divergence between falling Treasury bond yields and rising stock indexes may be starting to take its toll on the stock market. Major stock indexes are in the red today. The biggest selling, however, is coming from small caps and financials. At the... READ MORE
* Long-term background for bonds * Bond Prices at a critical short-term juncture point * Is the 5-year yield forming a massive top? * Utilities moving in sympathy with bonds * Interest sensitive REITS starting to improve * Follow the commodities Long-term background for bonds A lot of people are betting that stronger economic data will... READ MORE
GROWTH STOCKS ARE LEADING THIS YEAR'S STOCK RALLY... The S&P 500 and the Nasdaq hit new record highs yesterday, and the Dow isn't far behind. Large parts of the stock market, however, are lagging behind. That's not necessarily a good thing. The... READ MORE
* Lots of supporting breakouts * Confidence ratio on the verge of a major bullish breakout? * Financials: trick or treat? * The US is due for a bounce against the rest of the world * Is it time to play the China card? Lots of supporting breakouts Last week I pointed out that the... READ MORE
INDUSTRIAL SPDR HITS NEW RECORD... Chart 1 shows the Industrial Select SPDR (XLK) trading in record territory today. Today's higher price action is pushing the XLI above a sideways trading pattern that's been in effect since the start of March. Its relative strength line (above chart)... READ MORE
* Dollar Index experiences major trendline breaks and MA crossovers * Dollar sympathy relationships confirm a weaker dollar * Emerging currencies are emerging * Some currencies remain in bear market against the dollar Dollar Index experiences major trendline breaks and MA crossovers This week, the US Dollar Index ($USD) violated several key benchmarks, leading... READ MORE
RISING EUROPEAN CURRENCIES ARE PUSHING THE DOLLAR LOWER... While stocks are rebounding today, the dollar isn't. Chart 1 shows the Power Shares Dollar Index ETF (UUP) falling again today to the lowest level since November. It may seem surprising to see the dollar continuing to drop with bond... READ MORE
* 10-day ROC for the VIX may have a message for traders * Close that gap on your way out * Financials, a canary in the coal line for stocks in general Last week I wrote about the $VIX and concluded that a low reading, such as we recently saw, usually precedes a... READ MORE
BOND YIELDS CONTINUE TO DROP ... My Saturday message issued some short-term warnings for the market. Part of that warning came from falling bond yields which hinted that fixed income traders were turning more pessimistic. Another came from weak performances by banks, small caps, and transports which are leading the stock... READ MORE
U.S. STOCKS ARE GLOBAL UNDERACHIEVERS... Several of my previous messages have written about foreign stocks doing better than those in the U.S. this year. I'll come back to those foreign charts shortly. Chart 1, however, is designed to show how weak U.S. stocks have been... READ MORE
* Trying to replicate the Shanghai Composite with a Chinese ETF * Global Update Years ago, investing in China was a challenging proposition for US based investors. In recent years though, a number of ETF’s have been listed that embrace Chinese Indexes as well as specific sectors. The big daddy of... READ MORE
BOND YIELDS DROP ON FRIDAY... Some caution crept into financial markets near the end of the week. Part of that was reflected in Friday's sharp drop in bond yields. Chart 1 shows the 10-Year Treasury Yield falling back below its 50-day average in pretty decisive fashion. That was... READ MORE
* The VIX * The Dollar Index * The Euro * Swiss Franc * Japanese Yen The VIX Most of this piece is devoted to the dollar and some interesting looking currencies. However, I have been intrigued by a couple of articles and news stories recently appearing in the general purpose media. They have pointed... READ MORE
COMMODITIES DIVERGE FROM EEM... One of the long-held principles of emerging market behavior is that they're closely correlated to the direction of commodity prices. That's because several large emerging markets are exporters of commodities (like Brazil and Russia). China is the world's biggest importer... READ MORE
* $CRB and oil break to the downside * The stock market says commodities are headed lower * Bond market participants leaning in a deflationary way * Watch those commodity currencies The usual “Sell in May and Go Away” articles are starting to appear bigly, and a case can indeed be made in that... READ MORE
SECTOR LEADERSHIP... One of the problems facing the current stock market is that some sectors have been rising, while others have suffered large losses. Since the start of the year, for example, technology has gained nearly 14% versus a 6.7% gain for the S&P 500. Energy stocks,... READ MORE