An outlook on the US markets and oil
Doc is with us today to focus on what his technicals are telling him about the future for US stocks and oil. There are many signs that it will be hard to find large gains int he short term. For a trader there are some range-bound opportunities but protection is the best mentality right now.
Sorry for the slight echo on Doc’s side. Sometimes the recordings just do not turn out that way they should sound…
Click download link to listen on this device: Download Show
CFS-
Leverage is almost back to all time highs. Borrowed money always has a place to go, back to the bank.
Ah, and for all of those who expected the FED to lift rates as the 10 YR drops from 1.75% to 1.55%.
If CFS’s latter trends remain in place, where will rates be in December?
Interesting article from Taylor Dart at Seeking Alpha
In a nutshell, the article says that gold is the fifth best-performing asset class this year at a 25% gain approximately, a bit less now of course. But the bullish reading is only 23%. This is a similar bullish reading to the British Pound (21%) and the pound is down12.09% for the year. Gold’s bullish reading is similar to corn and the VIX as well and these assets are down 14.10 and 26.89 percent respectively YTD.
I am wondering what conclusions people draw from gold’s very low bullish reading in spite of its outperformance YTD?
The link to the Seeking Alpha article is below – such a long link!
And on a Donald sidenote:
“Cisco Systems Inc. plans to spend as much as $4 billion in Mexico over the next couple of years, upgrading its factories and increasing production through contract manufacturers” as reported by Bloomberg.
I personally don’t know how anybody could suggest Clinton won or came close to winning the debate. This is more than likely fixed. At points, it looked as if she was going to fall asleep, then her statements were read from the podium, her responses were lackluster, and it seems as if she was completely out of touch with reality.
Richard,
As a non-american who doesn’t care about Dems nor Reps – ie not suffering from party bias – but who’s been watching political debates since age 8 – ie who’s highly interested in such matters – to me the Donald got his ass kicked BIG TIME in the last hour. He looked like a total AMATEUR to me.
If you re-watch the debate, do yourself a favor: watch how many times he says “let me respond to that” in the last hour. He spent the last hour justifying himself/running after her. A-ma-teur.
LPG
LPG :
I agree that Mr. Trump struggled.
I will also say that the moderator soft balled Mrs. Clinton.
Where was the questions regarding immigration?
Where were the questions on the pay to play State Dept?
Why was Hillary not questioned about her dishonesty?
Luckily we have two more debates.This is far from over.
Like I said before.We as Americans were the losers last night.
The American media once again let us down.
Well said, JohnK. The media will never start a fire under these people.
They don’t have the balls, sorry. But they surely ignited the tax return issue and Obama birth certificate issue.
Did you see the media question to Yellen regarding the Wells Fargo oversight failure?
She side-stepped that one so much it looked like she was dancing.
And the reporter said nothing after that. FIXED. If that reporter questioned it, he more than likely would have lost his job.
Thanks LPG,
I did notice that. I always love to re-watch videos because one can miss so much the first time around. I am not saying Trump nailed it or knocked it out of the park. Sorry for the clichés. Trump more than likely was feeling defensive and uncomfortable on some of the matters at hand. On a whole, I would say good debate, but improvement was needed on both sides. Yes, he is an amateur to politics and one acts much differently in the boardroom. But I would not agree that Clinton should win the debate simply because he became distracted. It’s not about the skills of the debate as we all know Clinton has much more experience in that regard.
Trump became disgruntled but I really feel that Americans are looking at his passion, for lack of better words, for implementing change. Clinton on the other hand had a prepared answer that was so politically correct, it was nauseating. She presents an idealistic approach to the country and never delivers, just as so many others don’t deliver. It’s all words, it sounds great, but lacks substance. It reminds me of a con-man setting up the victim for the con. I have seen too many of them in my life and therefore have no problem spotting a “con” situation. Finally, by studying her facial and body expressions, one could easily see through her entire prepared remarks.
In reference to my comment on winning: I think the American public understands that Trump is going to implement change while Clinton is simply going to maintain the status quo and America needs change. She will talk tough on the “big guys” but behind the scenes, she will do everything possible to please the big banks / big players. There is a reason Goldman Sachs pays Clinton large sums of money to deliver speeches to their audiences. Americans are finally seeing though this. Maybe because of social media, other sources of news and media, etc. I don’t know exactly.
I think Trump summed it up perfectly when he stated that the Democrats visit the inner cities to gather votes by presenting lies and promises that were never intended on being kept. Then after the election, they disappear. Corzine in NJ was a perfect example of this.
Anyhow, on topic of the markets, I am not sure why DOC thinks the markets will not do too much when he seems to present a dire case for the markets and economy. I see an increase in volatility coming in quickly upon a failure. Same applies to the commodities.
This is going to be the sixth straight quarter where the S&P earnings have slumped.
Doc is right on saying that you have to look at year over year comps.
We all know how the game is played.
The third quarter was to be the “rebound” quarter and now it is in plain sight that this isn’t going to happen.
I keep hearing Big Al saying that at some point fundamentals are going to matter.
Have we reached that point?
Close. And if the dollar strengthens further it will not be because of GDP increases. And bingo, what percentage of the SPX earnings are “global” earnings, 60%-70%?
BINGO
+1
John, Just wanted to let you know what I am looking at technically versus fundamentally in the markets.
Based on the prior breadth thrust, a quick oversold condition that occurs now could potentially have the power to drive the market higher, 2,250 or so on a rebound. That could be terminal, but take it one day at a time with the technicals and forecasts.
Thanks for that Richard:
I like to watch the 20 dma and the 50 dma.The middle of Sept the 20 crossed the 50.
Back around the first of August the MACD did a negative cross while the S&P continued to climb.This could have fortell the drop to 2118.Now we have a gap island reversal in play.
If the S&P doesn’t make it past 2190 by October 5th,it could spell trouble.IMHO
That should have said October 15th
Good discussion JohnK & Richard. Thanks for some fundamental and technical food to chew on.
Also good discussion Doc & Cory on investors chasing dividend paying stocks and bonds, because it is hard to find yield for investors that want to park money anywhere else. CDs, Savings Accounts, Money Markets and most annuities, are below inflation levels and are losing money in real terms. The markets and bonds and to a lessor degree the metals and currencies have been where investors have been flocking. I’m honestly amazed at how long this experiment of near 0 interest rates has gone on, but “the show must go on” as they say…..
Yen and Gold – doing the safety dance as alternatives to central banking madness:
http://stockcharts.com/h-sc/ui?s=%24XJY&p=D&yr=2&mn=0&dy=0&id=p18739154842
For most of the last year there has been a relatively close correlation between Gold and TLT (proxy for longer term treasuries).
http://stockcharts.com/h-sc/ui?s=%24GOLD&p=D&yr=1&mn=0&dy=0&id=p05576929046
Thanks John
I took a look at those averages on the DJI and the DJU. For the DJU on a backtest of support, the 30 YR rate was about the same and yet this time, the DJU rallied as interest rates increased. Then the cup formation could indicate the DJU heading toward 750, thus an upcross of the 20 / 50 with a positive MACD.
Excelsior,
Yes see my comment on the DJU, proxy for dividends as per this topic.
The 5 YR fell out of the “rate increase” rectangle, tested and yields appear to be surrendering to any rate increases. When the FEDs raised rates, the 5 YR was almost 2%, 1.75%. Now it is 1.1% and appears to be heading to 80 bps, coupled with the cup breakout on the DJU.
Are there going to be December rate hikes??? HMMM?
Thanks Richard. Absolutely, the 5 yr rate continues to sink ever lower and the dividend stocks push higher. What an odd corner the world is backed into.
If nothing else it should be interesting to hear what Mr Fischer has dreamed up to tell the markets.
Richard, Right back at you.
The chart on the 5 year and the utilities was an eye opener.
When I put the fibs on the 5 year from 2012 to the present, earlier this year, the 5 year has already breached the 61.8% retracement from the 2013 high. Technically the 5 year looks pretty grim and your 80bps looks to be in the cards.
Donald, when asked about his tax returns, should have requested a look see on the Clinton Foundation return.
Whitewater legal matters next….
She likes Donald’s real estate DEALS so much,how about her scam
Haiti ,would be a great topic
Every thing coming up “Flowers”
Libya too — she hold much of the responsibility for what happened there, which also makes her a mass murderer, war criminal, and ally of Al Qaeda.
http://www.nytimes.com/2016/02/28/us/politics/hillary-clinton-libya.html?_r=0
“Her conviction would be critical in persuading Mr. Obama to join allies in bombing Colonel Qaddafi’s forces. In fact, Mr. Obama’s defense secretary, Robert M. Gates, would later say that in a “51-49” decision, it was Mrs. Clinton’s support that put the ambivalent president over the line.”
Not to mention hugely responsible for the refugee crisis.
Good one….Libya….ya
No doubt about it, how they went from paupers to millionaires, I mean maybe billionaires overnight! Hard work does not get you this in such a short period of time.
Donald should not release his tax returns until Obama releases his college transcripts.
The traitor spent a million bucks to have them sealed, so they must be very damning, but the media never cared.
Birth certificate ,social security number, how about a selective service number.
We go high ,when others go low….Michael Obama…
Dang phone 😉
In eight years ,,,did anyone see Obamy in church, …..outside of a political event.
No, you can’t be on the golf course or Hawaii at the same time as church 😉
I guess they forgot all the Body bags along the way…..
Jerry…I would not be surprised if all the occupant’s of said body-bags , were to vote Dems. in November.
Ha, …good one Irish…
Hope all is well with you!
Plus ca change, plus c’est la meme chose.
Wake up guys! The media will decide the outcome of the Presidential election, if we are not careful.
They have given us the-less-than brilliant-Trump.
Don’t believe me?
Here’s something from the wayback machine……4 years ago.
MSN…does not control Twitter.
CNN…..Clinton No Not, worth watching
I know what you meant by technicals, Cory, but technically the general market IS deteriorating…..
Sales are down. Earnings are down, Margins are down, Inventories are building, Productivity is not rising, Regulations are increasing, on average.
The probable reason the market is not dropping is financial repression: where else can money go? But there will come a time of reckoning; then watch the stampede for the exits.