• 401 days Will The ECB Continue To Hike Rates?
  • 401 days Forbes: Aramco Remains Largest Company In The Middle East
  • 403 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 803 days Could Crypto Overtake Traditional Investment?
  • 807 days Americans Still Quitting Jobs At Record Pace
  • 809 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 812 days Is The Dollar Too Strong?
  • 813 days Big Tech Disappoints Investors on Earnings Calls
  • 814 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 815 days China Is Quietly Trying To Distance Itself From Russia
  • 816 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 820 days Crypto Investors Won Big In 2021
  • 820 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 821 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 823 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 823 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 827 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 827 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 827 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 830 days Are NFTs About To Take Over Gaming?
How The Ultra-Wealthy Are Using Art To Dodge Taxes

How The Ultra-Wealthy Are Using Art To Dodge Taxes

More freeports open around the…

Another Retail Giant Bites The Dust

Another Retail Giant Bites The Dust

Forever 21 filed for Chapter…

What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

  1. Home
  2. Markets
  3. Other

Guideposts For An Indecisive Stock Market


Three Economic Strikes

Tuesday's economic news carried a theme of "below expectations". From The Wall Street Journal:

The Chicago Business Barometer, referred to as the Chicago PMI, fell to 60.5 in September from 64.3 in August. Economists surveyed by The Wall Street Journal had expected a reading of 62. The Conference Board's index of consumer conference fell to 86 in September from 93.4 in August, missing expectations for a reading of 92.8. And the S&P/Case-Shiller Home Price Index showed U.S. home prices rose 5.6% in the 12 months ended in July, down from 6.3% in June. Economists surveyed by The Wall Street Journal had expected a 5.8% rise in the national index. The 20-city price index rose 6.7%, less than the 7.3% expected.


Short-Term Guideposts

As noted in this week's video, the broader equity market is showing some "pay attention" signals, along with deteriorating market breadth. On the bullish side of the ledger, the longer-term charts still look good and we know an open mind is required when the S&P 500 is hovering near a flat 50-day moving average (as it is now). Therefore, drawing lines in the sand can help us balance the need to be patient with the need to protect capital in the event of ongoing weakness. In the short-term, if Monday's lows are taken out, it increases the odds of additional weakness in stocks (see point A below). The odds of good things happening short-term will increase if the NYSE Composite can close above its 50-day (near point B).

The current state of weekly stock market momentum (very weak and vulnerable) tells us risk levels need to be watched closely. We are accounting for downside risks with a higher than normal stake in cash and IF, THEN contingency planning. Wednesday brings a report on manufacturing and Friday features the monthly labor report.

 

Back to homepage

Leave a comment

Leave a comment