Several Risk-On Metrics Diverging, But Momentum Ball With Bulls For Now

US stocks rallied strongly last week.  Bulls enjoy momentum right now.  That said, risk-on is not full-on.  What transpires at 2890s on the S&P 500 can be a tell near term. May’s employment report was mixed at best and disappointing … Continued

Opportunity For Small-Cap Bulls To Forge Crucial Breakout – Can They Deliver?

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The Russell 2000 closed Friday right at, or slightly past, crucial resistance.  If bulls succeed in decisively take out this ceiling, risk-on sentiment can rise.  Failure to do so can lead longs, who are sitting on handsome gains, to lock … Continued

Retail Sales Data Gives More Ammo To Those Fearing Recession

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Thursday’s retail sales data likely poured more gasoline into the recession-fear fire.  The cycle is getting long in the tooth.  Risks are rising.  The expansion has lasted for nearly a decade.  Contraction is just a matter of when not if. … Continued

Bulls Defend Crucial Support Last Week, But On Back Foot

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US stocks took it on the chin last week.  Large-caps held up better, but risk aversion was seen elsewhere.  The Dow Industrials was essentially unchanged, and the S&P 500 large cap index lost one percent.  The tech-heavy Nasdaq 100 index … Continued

US Jobs Picture Strong, Hence Its Significance In Signaling Inflection Point

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US economic data of late have been coming in strong.  Real GDP printed 4.1 percent growth in 2Q18.  This was the strongest growth rate in 15 quarters.  As of last Friday, the Atlanta Fed’s GDPNow model expects 4.4 percent growth … Continued

By Year-End, Fed Funds On Pace To Exceed Inflation Rate – That Should Begin To Bite

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If the Fed moves in September and December, the fed funds rate will be in excess of core inflation.  In a leveraged economy, that should begin to bite.  The FOMC dot plot expects three more hikes next year.  This is … Continued

Nasdaq 100 Breakout Fri Follows In Small-Caps’ Footsteps – Large-Caps Next, Or Not?

Major US equity indices all peaked late January – the S&P 500 large cap index, the Dow industrials and the Nasdaq 100 index on the 26th and the Russell 2000 small cap index on the 24th.  This was followed by … Continued

What If?

posted in: Credit, Economy | 0

Is the U.S. economy strong, weak or just about right?  Better yet, is it getting stronger, weaker or going sideways?  The truth is, pessimists and optimists both can selectively pick and choose to support their own bias. That said, data … Continued

As Good As It Gets?

Chart 1 shows decent relationship between year-over-year change in the S&P 500 large cap index and the ISM manufacturing index. U.S. manufacturing activity has picked up – from 49.4 last August to 57.5 in February.  The 8.3-point six-month jump is … Continued