June 9, 2019
Weekly Market Outlook
By Keith Schneider
Fed Chairman Powell stated that tariffs could shave some points off of growth, hence, a need to lower rates.
That spurred a vicious stock market rally of almost 4% for the week.
The agreement with Mexico didn’t hurt either, nor did the drop in the dollar versus most currencies, especially the Euro. Hello Modern Monetary Theory, we hope it works but I remain doubtful.
Mixed messages abound with Gold roaring and refusing to sell off, Long Bonds yields hitting new lows they have not seen in almost 1½ years (not budging from frothy levels), and Copper screaming that economic activity is waning.
Other suspicious divergences are that the Russel 2000 is languishing while sentiment indicators remain unconvinced that the rally is real.
Most members of the economic modern family are not happy, indicating a cyclical slowdown.
Now that we have gotten the bad news out of the way, let’s look at some positives.
First, pure price action was pretty awesome, Semis, a spec sector performed well, and some internals improved as well.
As always, price action trumps all, and of course speaking of Trumping action, we are just a tweet away from a sea change so stay flexible and don’t let your politics cloud your objective analysis.
This week’s highlights are:
With markets so directional short-term our favorite indicator is using floor trader pivots along with the opening range to catch these violent short-term moves and stick with the momo while it lasts. (if you’d like to learn how to do this too, check out this free webinar)
And for more great resources….
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Best Wishes for your trading!