Steve Todd notes that although we have broken a downdtrend line from January, the Stock Market is somewhat overbought. The real short term money has been made in his bullish US Dollar and Bearish Gold posiitions R. Zurrer for Money Talks.
For 3pm PST Wednesday May 9, 2018
DOW + 182 on 675 net advances
NASDAQ COMP + 73 on 691 net advances
SHORT TERM TREND Bullish
INTERMEDIATE TERM Bullish
STOCKS: There seemed to be several factors at work on Wednesday. First, the political reaction to the decision on Iran seemed to be pretty mild on Tuesday. This probably encouraged investors.
Second, the inflation data was pretty benign. This suggested that the Fed may not be so anxious to raise rates.
Third, CNBC pointed out that there was a technical breakout for the S&P 500. We show this in the chart below.
GOLD: Gold was lower by $1. Very minor range at present.
CHART: The S&P 500 broke out of a declining trendline connecting a series of peaks going back to late January. This may have encouraged buying by traders who monitor this type of thing. Yes, we are overbought and that is something to be aware of.
BOTTOM LINE: (Trading)
Our intermediate term system is on a buy.
System 7 We are in cash. Stay there on Thursday.
System 9 We are neutral.
NEWS AND FUNDAMENTALS: The PPI-FD rose 0.1%, less than the expected 0.3%. Oil inventories dropped 2.2 million barrels. Last week they rose 6.2 million. On Thursday we get the CPI and jobless claims.
INTERESTING STUFF : There is no great genius without some touch of madness. -----Aristotle
TORONTO EXCHANGE: Toronto gained 68.
BONDS: Bonds were lower.
THE REST: The dollar had a mild drop. Crude oil surged to a new rally high.
Bonds --Bullish as of April 26.
U.S. dollar - Bullish as of April 23.
Euro --- Bearish as of April 23.
Gold ----Bearish as of March 27.
Silver---- Bearish as of March 27.
Crude oil ----Bullish as of May 4.
Toronto Stock Exchange----Bullish as of Feb. 12.
We are on a long term buy signal for the markets of the U.S., Canada, Britain, Germany and France.