* More stock market indicators showing weakness * Bonds close to a breakout * Commodity rally over? * Dollar bottoming or about to break down? More stock market indicators showing weakness Last week I made the case for a correction in the market based on some specific indicators that has started to flash some... READ MORE
SMALL AND MID SIZE STOCK INDEXES BREAK SUPPORT... Yesterday's message showed small and midcap stock indexes testing support at their July lows, and warned that any further weakness would be bad for them and the rest of the market. Both indexes have broken support levels and are now... READ MORE
S&P 500 PULLS BACK ... Global stocks are in the red today, which continues the profit-taking that started yesterday afternoon. Yesterday's downside reversal day in U.S. stock indexes on rising volume signaled the likelihood of more profit-taking. Foreign stocks in Europe and Asia are falling more... READ MORE
* Bullish percent indicators are starting to deteriorate * Short-term confidence may be turning * Small caps getting smaller? * Oversold Dollar Index bounces from support Bullish Percent Index indicators are starting to deteriorate This week we saw the financial media and President Trump glorify the fact that the DJIA had exceeded 22,000... READ MORE
DOW HITS NEW RECORD WHILE NASDAQ HOLDS BACK ... The Dow Industrials continue to lead the market higher. Chart 1 shows the Dow ending the week at a new record. Its weekly gain of 1.2% led all other market indexes. Its 14-day RSI line, however, shows the Dow now in... READ MORE
ENERGY PRICES ROSE DURING JULY... A report on Tuesday covered economic conditions during the second quarter. One of the things it showed was continuing low inflation, which remains well below the Fed's target of 2%. One of the factors mentioned was falling energy prices. Naturally, the media reported... READ MORE
DOW OUTPERFORMANCE MAY NOT BE A SIGN OF MARKET STRENGTH... It seems everyone in the media has been transfixed on the Dow Industrials hitting 22K this week. And they cite that as proof that the stock rally is alive and well. That recent Dow strength, however, is coming from a... READ MORE
The Market Round Up Video Recording for August is available. Use the HD button for better clarity when viewing. Market Round Up Live With Martin Pring 2017-08-01 from StockCharts.com on Vimeo. Good luck and good charting, Martin J. Pring The views expressed in this article are those of the... READ MORE
* The longer-term indicators very finely balanced * The Gold/dollar ratio may be providing some leadership * Gold shares may have something to say in the matter The longer-term indicators very finely balanced The price of Gold has been in a trading range since late 2013, and has traded even more narrowly... READ MORE
CURRENCIES HAVE AN IMPACT ON INFLATION RATES... Persistently low inflation is worrying central bankers around the globe. Even the Fed has expressed more concern of late. Central bankers in Australia, Canada, Europe, and Japan have also mentioned low inflation as restraining them from abandoning their ultra-loose monetary policies. So far,... READ MORE
TRANSPORTATION ISHARES FALL BELOW 50-DAY LINE... After hitting a new record earlier in the month, transportation stocks are being sold pretty hard today . Chart 1 shows the Transportation Average iShares (IYT) plunging 3% to the lowest level in nearly two months. The IYT has also fallen back below its 50-day... READ MORE
A LOT IS RIDING ON DOLLAR DIRECTION... After hitting a 14-year high at the end of 2016, the U.S. Dollar Index has lost 8% during 2017. A lot of that slide came from disappointment in the so-called Trump reflation trade which was supposed to boost the U.S. economy,... READ MORE
* The US versus the world * Two reasons why US equities are likely to underperform * What does the rest of the world say? I have been writing for some time that, notwithstanding the inevitable but unpredictable near-term correction, the US market is in good technical shape and likely to work its... READ MORE
BOND YIELDS MAY BE BOTTOMING... Bond yields are jumping today. Their chart patterns also suggest that yields may be bottoming. Chart 1 shows the 10-Year US Treasury YIeld ($TNX) jumping 6 basis points today to push it back above its (red) 200-day average. The trendline drawn over its May/July... READ MORE
* What is a confidence indicator? * Credit Spreads to the rescue * Equity market spreads * Growth versus Value * Small caps: Are we there yet? Washington may be suffering from acute dysfunction but Wall Street doesn’t seem to care, or perhaps knows something that we mere mortals do not. Failure to agree... READ MORE
FALLING DOLLAR BOOSTS EMERGING MARKET CURRENCIES... One of my recent messages explained that a weak dollar was contributing to money flows into foreign markets. That's because American investors get the dual benefit of rising foreign currencies as well as stocks. That's been especially true in emerging... READ MORE
CHINESE ECONOMY EXCEEDS EXPECTATIONS... China's economy grew by 6.9% during the second quarter which exceeded market expectations. That's one of the explanations behind today's jump in industrial metals like copper, iron ore, and zinc. Mining stocks that produce those commodities are also having... READ MORE
BOND YIELDS DROP ON LACK OF INFLATION ... June's CPI report showed no change from the previous month, reflecting the absence of inflation. Its annual gain of 1.6% was the smallest since last October. Excluding food and energy, the core CPI saw a modest monthly bounce of 0.... READ MORE
CANADA RATE HIKE BOOSTS THE LOONIE... Canada warned that it was about to hike rates, and did it yesterday for the first time in seven years. The Bank of Canada raised its short-term policy rate 25 basis points to 0.75%. That's still below the rate of 1.... READ MORE
1. Some Global Equity Markets Getting Lift-off Again 2. US equities trying to follow the global lead 3. Relative trends favor emerging and Europe 4. Technology poised to move higher In terms of price, global equities have been in a corrective mode since late May, but now appear to be... READ MORE
FALLING DOLLAR MAY GIVE FED A HAND... Bonds and stocks are reacting very positively to written comments by Janet Yellen before Congress today. Her comments are being interpreted as being more dovish than anticipated, owing mainly to Fed concerns about persistently low inflation. It's hard for the Fed... READ MORE
* The Long-term indicators * Gold in Euro and Yen looking sick * Dollar based Gold completes head and shoulders top gold shares not quite there yet * Silver showing signs of tiredness * Stocks breaking out against Gold * The silver lining for Gold Several articles I have written in the last few weeks have... READ MORE
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