Risk on as Stocks Roar Despite Geo-Political Turmoil

May 13, 2018

Weekly Market Outlook

By Keith Schneider

US Equities roared this week with each of the four benchmarks putting in a dazzling performance up over +2.5% on average,  performing with immunity from what most students of history would say is more than a hairline fracture. The escalation of hostility on the Golan Heights is troubing as well as the populist win in Italy unveiling an even more fractured NATO and EU.

Here are some of this week’s highlights:

  • All Key Equities Indexes regained positive phases
  • Daily chart momentum is still a concern for the benchmark SPY but IWM is a standout
  • IWM (US small caps) is emerging as market leader
  • Volume picked up with IWM showing strongest volume figures
  • There is a compelling short-term pattern in IWM
  • Risk Equities regained leadership over Utilities
  • Sector performance improved the general outlook
  • Volatility got hit hard and took out critical swing lows

When you watch this week's video, you'll see the areas of the market that are suggesting there are good reasons to believe that the SPY will follow the IWM's lead higher. If you'd like a trading system that enables you to know when to be long SPY or in cash, click here to see our recent training session on our Alpha Rotation System which has beat the market (and been profitable) every year since 2008. As a result it has also generated returns of over 2,300% since 2008.

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