European rallies at important juncture.

Tuesday, August 26, 9:25 a.m.

Our technical indicators (not shown) have had us calling for a rally in Europe’s markets off their short-term oversold condition beneath 50-day moving averages.

For a couple of weeks it was just not happening. Every time they tried to rally they were hit with more bad news, either on their economies or in the form of renewed hostilities between Russia and Ukraine.

However, they finally received a calm spot within which they have been rallying.

The next question is whether having rallied back to their 50-day moving averages, they will be able to break through that potential resistance, as the U.S market has, or will their rallies find the 50-day m.a to be resistance that halts yet another rally attempt?

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The new issue of our Street Smart Report newsletter will be out tomorrow with our technical indicators, short-term, intermediate-term, and long-term, and in depth analysis of the economy and markets, including stocks, bonds, and gold.

To subscribe online click here:https://streetsmart.securesites.net/order.html

To read my weekend newspaper column click here: Is it Time To Ignore the Fed-

Subscribers to Street Smart Report:

In addition to the charts and signals in the ‘premium content’ area of this blog, the new issue of the newsletter will be out tomorrow in your secure area of the Street Smart Report website. 

Yesterday in the U.S. Market. 

Another positive day on very light volume of only 0.48 billion shares traded on the NYSE. The Dow was up 124 points at mid-day but sold off some in the afternoon to close up 75 points.

The Dow closed up 75 points, or 0.4%. The S&P 500 closed up 0.5%. The NYSE Composite closed up 0.5%. The Nasdaq closed up 0.4%. The Nasdaq 100 closed up 0.4%. The Russell 2000 closed up 0.4%. The DJ Transportation Avg. closed up 0.3%. The DJ Utilities Avg closed down 1.4%.

Gold closed down $3 an ounce at $1,275.

The U.S. dollar etf UUP closed up 0.3%.

The 20-yr bond etf TLT closed up 0.4%.

The China etf GXC closed up 0.8%.

European Markets continued to rally off their oversold condition yesterday.

The Europe Dow closed up 1.1%.

The London FTSE closed down 0.1%. The German DAX closed up 1.8%. France’s CAC closed up 2.1%. Belgium closed up 0.7%. Denmark closed up 0.9%. Finland closed up 0.5%. Greece closed up 0.3%.  Ireland closed up 0.7%. Italy closed up 2.3%. Netherlands closed up 1.2%. Norway closed up 0.6%. Portugal closed up 1.1%. Spain closed up 1.8%. Switzerland closed up 0.7%.

Asian Markets closed down last night.

The Asia Dow closed down 0.2%. Among individual countries:

Australia closed up 0.1%. China closed down 1.0%. Hong Kong closed down 0.4%. India closed unchanged. Indonesia closed down 0.7%. Japan closed down 0.6%. Malaysia closed down 0.1%. New Zealand closed up 0.3%. South Korea closed up 0.4%. Singapore closed down 0.2%. Taiwan closed up 0.1%. Thailand closed down 0.2%.

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Markets This Morning:

European markets are up again this morning.

The Europe Dow is up 0.3%.

The London FTSE is up 0.5%. The German DAX is up 0.3%. France’s CAC is up 0.7%. Belgium is up 0.2%. Denmark is up 0.2%. Finland is up 0.1%. Greece is up 0.8%. Ireland is up 0.5%. Italy is up 0.7%. Netherlands is up 0.4%. Norway is up 0.3%. Portugal is up 1.0%. Spain is up 0.8%. Switzerland is up 0.3%.

This Morning in the U.S. Market:

Oil is up $.31 a barrel, at $93.66

Gold is up $10 an ounce at $1,289.

This week’s Economic Reports:

This week will be a busy week for potential market-moving reports, including new home sales, durable goods orders, consumer confidence, the first revision of 2nd quarter GDP, and others. To see the full list and times click here, and look at the left side of the page it takes you to.

Yesterday’s reports were that the Chicago Fed’ National Business Activity Index improved from 0.21 in June to 0.39 in July. But a later report for August, was that the Dallas Fed’s Mfg Index fell from 19.1 in July to 6.8 in August. Meanwhile, it was reported that new home sales declined 2.4% in July to an annualized rate of 412,000, the slowest pace in four months, and missing the consensus forecast of an increase to 430,000.

This morning’s reports so far are that Durable Goods Orders jumped 22.6% in July, but due to large transportation orders, primarily of Boeing airliners. EX-transportation orders, orders for the rest of the economy declined 0.8% “amid widespread weakness”, missing the consensus forecast for orders to be up. The Case-Shiller Home Price Index showed home prices were up another 1.0% in June.  The FHFA Home Price Index gained 0.4% in June.

Still to come is Consumer Confidence at 10 a.m.

The pre-open indicators were not affected much by the disappointing Durable Goods Orders.

Our Pre-open Indicators:

Our pre-open indicators are pointing to the Dow being up 25 points or so in the early going.

I’ll be back with the next post on Thursday morning at 9:25 a.m.

To read my weekend newspaper column click here: Is it Time To Ignore the Fed-

Subscribers to Street Smart Report:

In addition to the charts and signals in the ‘premium content’ area of this blog, the new issue of the newsletter will be out tomorrow in your secure area of the Street Smart Report website.  

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If you haven’t done so yet, check out our new bull market/bear market indicator (BBMI) by clicking here: Market Timing Strategy

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**** End of Today’s post*****

Why you should not ignore what Shiller is saying.

Saturday, August 23, 11:45 a.m.

Robert Shiller, Nobel laureate in economics, had an article in the New York Times last weekend, and followed it up with an interview on CNBC Tuesday. Some of his comments:

"There’s something bizarre going on."

"The U.S. stock market looks very expensive right now. . . . . . The CAPE 10 P/E ratio is at 25, far above its 20th century average of 15.21, a level that has been surpassed since 1881 in only three previous periods: the years clustered around 1929, 1999, and 2007. Major market drops followed those peaks."

I will interrupt with an observation:

The fact that the current market valuation level was exceeded three times in those extreme bubbles of the last 130 years, has some believing that until overvaluation reaches those extremes again there is little risk.

It might be well to realize that there have been not three, but 25 bear markets over the last 113 years (as far back as my data goes). Their average decline was 36%. The average of the worst ten was 50%.

So the real story is that market valuation is now much higher than at the peak of 22 of the last 25 bear markets. That is, 88% of the time a bear market began with market valuation at the current level or lower. That is almost 9 to 1 odds against higher prices.

Back to Shiller:

"Why are bond prices also so high [yields so low]? There are short-term explanations: the role of central banks, for example. But is there a compelling reason for prices of stocks and bonds (and maybe houses, too) to remain high indefinitely? . . . . . . Nothing I’ve come up with is a slam-dunk explanation for the continuing high level of valuations."

In the CNBC interview, Shiller also expressed surprise at valuations in the housing market.

Noting that home prices are up 25% since their low in 2009, he said, "We’re seeing a sort of boom in housing prices. We’ve got stocks and bonds highly priced, and now we’re seeing maybe housing going in the same direction. It’s like everything is pricey."

He partially blames anxiety about the future.

"Worries about the future can actually cause asset markets to be priced highly. . . .  When the Titanic was going down, people would pay a fortune for anything that floats. I’m exaggerating of course, but that might be the situation we’re in now."

Do not easily dismiss what he is saying.

This was his warning in his book ‘Irrational Exuberance’ near the serious market top in 2000, "The present stock market displays the classic features of a speculative bubble, sustained largely by investors’ enthusiasm rather than by any consistent estimation of real value.” He warned that the bursting of that tech bubble would have a “cascading effect” on the rest of the stock market.

The 50% plunge in the 2000-2002 bear market followed.

This was his warning in 2007, "Housing prices have become dangerously over-inflated, are in a serious bubble that will burst and lead to a string of bankruptcies and a world-wide recession”.

The bursting of the housing bubble, the 2007-2009 bear market, and the ‘Great Recession’ followed almost immediately.

His warnings now, even if he is joking in his reference to the current situation of investors grasping at anything that floats as being similar to when the Titanic was going down, should not be ignored.

Particularly when we are hearing about Warren Buffett holding onto more cash than any time since he took over Berkshire Hathaway, and George Soros having increased his bet against the S&P 500 again with leveraged Put options, to $2.2 billion, or 16.7% of the total assets in his fund.

More on central banks, or at least our central bank:

To read my weekend newspaper column click here:  Is it Time To Ignore the Fed-

Still more on the Fed.

Excerpts from an article on Yahoo Finance by Charlie Billello, CMT, Director of Research at Pension Partners LLC. The article is titled ‘Seven Years Later: What Does the Fed Know? To see the entire article click here: blog-seven-years-later-what-does-the-fed-know-161945112.html-soc_src=unv-sh

Excerpts:

“It’s hard to believe it’s been seven years since the epic rant by Cramer about the Fed [which included references to the Fed and Fed Chair Bernanke; “They’re nuts. . . . they have no idea what is going on out here. This is a different kind of market and the Fed is asleep”]. It was August 3, 2007, two months before the ultimate stock market top. . . . . the start of the housing collapse had already begun.   The largest financial firms had significant exposure to securities predicated on the belief shared by the Fed and chairman Bernanke that on a nationwide basis “housing prices never go down.” . . . .

“A month later the Fed would comply with Cramer’s request and cut the Fed Funds Rate from 5.25% to 4.75%. They would continue cutting rates until December 2008 when they moved the rate down to zero. The S&P 500 declined 57% during the period.”

“Seven Years Later: What Does The Fed Know? The Fed Funds Rate still stands at 0%, more than five years into the economic recovery. Financial conditions have normalized, deflation is no longer a legitimate concern, equity markets are at all time highs, and yields on risky debt are at all time lows. Why in the world is the Fed maintaining such an aggressive policy stance? . . . . . “They must know something” is the popular refrain.”

“Indeed, the same organization that missed (and whose policies encouraged) the internet and housing bubbles when they were right before their eyes, is now credited with having unique foresight into the future.”

“Jim Cramer was correct. The Fed knew nothing in August 2007, and from all the available evidence they know even less now. . . . . What they really do know a lot about is not the economy, employment, or real wages. What they know a lot about is how to blow bubbles. Indeed, they have likely already created the third financial bubble in the last fifteen years. They pretend to be totally oblivious to the relationship between 0% interest rates and rampant speculation . . . . an all-encompassing search for yield into the risk bubble.”

“When this bubble bursts we can expect the Fed to do more of the same: deny any culpability and try to inflate once again.”

Can this really be good long-term policy, focused on the creation of bubbles and crashes? I think we all know the answer. But at this point we’re mesmerized by rising asset prices and remain silent. . . .  Only after a sharp decline will we start pointing fingers.”

Other Voices.

The Economist: “In a sense stock markets have defied gravity. . . . . A factor has been companies use of cash to buy back their stock. . . . American firms announced buy-backs worth $671 billion last year, and have made plans for nearly $300 billion this year. This is more than four times the amount of money placed into equity funds by retail and institutional investors combined. Like a snake swallowing its own tail, the corporate sector is absorbing its own stock equity. How long this can continue is anyone’s guess. The peak year for share buy-backs was 2007, just before the debt crisis. That is not a great omen.” 

Comment: Obviously if that high a percentage of money flowing into the market is companies buying their own stock from investors, when they stop, or even cut back, who will buy the stock sellers want to sell? Indeed, that is not a good omen.

Subscribers to Street Smart Report:

In addition to the charts and signals in the ‘premium content’ area of this blog, the new issue of the newsletter will be out on Wednesday in your secure area of the Street Smart Report website.

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Check out our new bull market/bear market indicator (BBMI) by clicking here: Market Timing Strategy !

U.S. market yesterday.

A mixed day, little movement either way, and again on very light volume, just 0.5 billion shares traded on the NYSE.

The Dow closed down 38 points, or 0.2%. The S&P 500 also closed down 0.2%. The NYSE Composite closed down 0.3%. The Nasdaq closed up 0.1%. The Nasdaq 100 closed up 0.1%. The Russell 2000 closed unchanged. The DJ Transportation Avg. closed unchanged. The DJ Utilities Avg closed down 0.3%.

Gold closed up $6 an ounce at $1,280 an ounce.

The U.S. dollar etf UUP closed up 0.2%.

The 20-yr bond etf TLT closed up 0.6%.

The China etf closed unchanged.

Asian markets mostly closed up in their last session of the week.

The Asia Dow closed up 0.3%.

Among individual markets:

Australia closed up 0.1%. China closed up 0.5%. Hong Kong closed up 0.5%. India closed up 0.2%. Indonesia closed down 0.1%. Japan closed down 0.3%. Malaysia closed down 0.1%. New Zealand closed up 0.3%. South Korea closed up 0.6%. Singapore closed up 0.1%. Taiwan closed up 1.3%. Thailand closed up 0.4%.

European markets closed down yesterday.

The London FTSE closed down 0.1%. The German DAX closed down 0.7%. France’s CAC closed down 0.9%. Belgium closed down 0.3%. Denmark closed down 0.5%. Finland closed down 0.6%. Greece closed up 1.1%. Ireland closed down 0.1%. Italy closed down 0.5%. Netherlands closed down 0.3%. Norway closed down 0.3%. Portugal closed down 0.6%. Spain closed down 0.5%. Switzerland closed down 0.2%.

Global markets for the week. 

A continuing rally week, that began from a short-term oversold condition. Even Euro-zone markets were finally in rally mode.

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THIS WEEK (August 22)
DJIA 17,001 +2.0%
S&P 500 1988 + 1.7%
NYSE 10947 +1.4%
NASDAQ 4538 +1.7%
NASD 100 4052 +1.6%
Russ 2000 1160 +1.7%
DJTransprts 8429 +2.0%
DJ Utilities 555 +1.2%
XOI Oils 1,656 +0.9%
Gold bull. 1,280 -1.8%
GoldStcks 99.45 -2.5%
Canada 15535 +1.6%
London 6775 +1.3%
Germany 9339 +2.7%
France 4252 +1.9%
Hong Kong 25112 +0.6%
Japan 15539 +1.4%
Australia 5640 +1.5%
S. Korea 2056 -0.3%
India 26419 +1.2%
Indonesia 5198 +1.0%
Brazil 58407 +2.9%
Mexico 45374 +1.7%
China 2345 +0.6%
LAST WEEK (August 15)
DJIA 16662 +0.7%
S&P 500 1955 + 1.2%
NYSE 10796 +1.0%
NASDAQ 4464 +2.2%
NASD 100 3987 +2.6%
Russ 2000 1141 +0.9%
DJTransprts 8264 +2.1%
DJ Utilities 549 +1.1%
XOI Oils 1,642 -0.4%
Gold bull. 1,304 -0.5%
GoldStcks 101.97 +0.7%
Canada 15284 +0.6%
London 6689 +1.9%
Germany 9092 +0.9%
France 4174 +0.7%
Hong Kong 24954 +2.6%
Japan 15318 +3.6%
Australia 5559 +2.4%
S. Korea 2063 +1.6%
India 26103 +3.1%
Indonesia 5148 +1.9%
Brazil 55745 +2.1%
Mexico 44629 +1.2%
China 2331 +1.5%
PREVIOUS WEEK (August 8)
DJIA 16553 +0.4%
S&P 500 1931 + 0.3%
NYSE 10691 -0.1%
NASDAQ 4370 +0.4%
NASD 100 3888 +0.2%
Russ 2000 1131 +1.5%
DJTransprts 8092 –0.3%
DJ Utilities 542 +0.4%
XOI Oils 1,648 +1.1%
Gold bull. 1,311 +1.4%
GoldStcks 101.26 +1.8%
Canada 15196 -0.1%
London 6567 -1.7%
Germany 9009 -2.2%
France 4147 - 1.3%
Hong Kong 24331 -0.8%
Japan 14778 -4.8%
Australia 5429 -2.1%
S. Korea 2031 -2.0%
India 25329 -0.6%
Indonesia 5053 -0.7%
Brazil 55603 -0.5%
Mexico 44105 +0.3%
China 2297 +0.4%

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Next week’s Economic Reports:

Next week will be a busy week for potential market-moving reports, including new home sales, durable goods orders, consumer confidence, the first revision of 2nd quarter GDP, and others. To see the full list and times click here, and look at the left side of the page it takes you to.

To read my weekend newspaper column click here:  Is it Time To Ignore the Fed-

Subscribers to Street Smart Report:

In addition to the charts and signals in the ‘premium content’ area of this blog, the new issue of the newsletter will be out on Wednesday in your secure area of the Street Smart Report website.

I’ll be back with the next blog post Tuesday morning at 9:25 a.m.

Non-Subscribers:

SUBSCRIBE NOW! To get all of this:

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**** End of Today’s post*****

Were inflation concerns overblown?

Thursday, August 21, 9:25 a.m.

Concerns were spiking a couple of months ago that the Fed’s easy money policies, and the recovering economy, finally had inflation showing up. The PPI, CPI, and PCE inflation indexes jumped above the Fed’s comfort level of 2%, while the employment cost index also unexpectedly jumped in the 2nd quarter.

In the background commodity prices were rising, crude oil back above $100 a barrel. And the historic hedge against inflation, gold, was rallying again.

However, last week it was reported that the Producer Price Index (PPI), which was up 2.1% in April, 2.0% in May, and 1.9% in June, was up only 0.1% in July.

And yesterday, it was reported that the Consumer Price Index (CPI), which was up 2.1% in June, was up only 0.1% in July.

Was it just a one month reprieve?

Perhaps not, at least based on the the way crude oil prices and gold have given up their rally attempts.

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New Housing Starts – the longer-term picture. 

Housing starts created some excitement this week, jumping 15.7% in July to an annual rate of 1.09 million from 945,000 in June, better than the consensus forecast of 975,000.

They’re not quite as exciting when looked at from a longer-term view, better than they were at the worst of the financial meltdown, but still depressed, well below their level of 15 years ago, about where they were in early 2008.

Historical Data Chart

To read my weekend newspaper column click here:   Bonds Persist in Their Warning About the U.S. Economy

Subscribers to Street Smart Report:

In addition to the charts and signals in the ‘premium content’ area of this blog, there is an in-depth Markets Report (stock market, gold, bonds) from last evening in your secure area of the Street Smart Report website.

Yesterday in the U.S. Market. 

A mixed day, positive for the blue chips, negative for small stocks. Not many participants, with barely over 0.5 billion shares traded on the NYSE.

The Dow closed up 59 points, or 0.4%. The S&P 500 closed up 0.3%. The NYSE Composite closed up 0.2%. The Nasdaq closed down 0.1%. The Nasdaq 100 closed unchanged. The Russell 2000 closed down 0.4%. The DJ Transportation Avg. closed up 0.5%. The DJ Utilities Avg closed up 0.2%.

Gold closed down $4 an ounce at $1,292.

The U.S. dollar etf UUP closed up 0.5%.

The 20-yr bond etf TLT closed down 0.2%.

The China etf GXC closed down 0.4%.

European Markets mostly closed down yesterday.

The Europe Dow closed down 0.3%.

The London FTSE closed down 0.4%. The German DAX closed down 0.2%. France’s CAC closed down 0.3%. Belgium closed down 0.6%. Denmark closed up 0.1%. Finland closed up 0.6%. Greece closed up 1.0%.  Ireland closed down 0.3%. Italy closed down 0.2%. Netherlands closed unchanged. Norway closed up 0.6%. Portugal closed down 0.1%. Spain closed up 0.3%. Switzerland closed up 0.1%.

Asian Markets closed mixed last night.

The Asia Dow closed down 0.3%. Among individual countries:

Australia closed up 0.1%. China closed down 0.4%. Hong Kong closed down 0.7%. India closed up 0.2%. Indonesia closed up 0.3%. Japan closed up 0.9%. Malaysia closed down 0.2%. New Zealand closed up 0.2%. South Korea closed down 1.4%. Singapore closed unchanged. Taiwan closed down 0.4%. Thailand closed up 0.1%.

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Markets This Morning:

European markets are off earlier highs but up this morning.

The Europe Dow is up 0.5%.

The London FTSE is up 0.2%. The German DAX is up 0.5%. France’s CAC is up 0.8%. Belgium is up 0.4%. Denmark is down 0.4%. Finland is up 0.5%. Greece is up 1.5%. Ireland is up 0.7%. Italy is up 1.5%. Netherlands is up 0.3%. Norway is up 0.1%. Portugal is unchanged. Spain is up 1.0%. Switzerland is up 0.6%.

This Morning in the U.S. Market:

Oil is down $.10 a barrel, at $93.40

Gold is plunging $19 an ounce at $1,276.

This week’s Economic Reports:

This week’s reports include the first look at the housing industry in a while, and include: the Housing Market Index, New Housing Starts, Existing Home Sales, Consumer Price Index, minutes of the last FOMC meeting, etc. To see the full list and times click here, and look at the left side of the page it takes you to.

Monday’s report was that the Housing Market Index, which measures the confidence of Home-Builders, improved from 53 in July to 55 in August, indicating 55% of home-builders are now optimistic, the second straight month with more than 50% optimistic. That is the index’s highest level in 7 months.

Tuesday’s reports were that the Consumer Price Index remained benign in July, rising only 0.1%, with the core rate also up just 0.1%. And we got good news from the housing industry for the first time in a long while. New Housing Starts jumped 15.7% in July to an annual rate of 1.09 million from 945,000 in June, better than the consensus forecast of 975,000. And permits for future starts rose 8.1% to an annual rate of 1.05 million.

Yesterday’s only report was the release of the minutes of the Fed’s last FOMC meeting, which indicated the Fed may be closer than previously thought to beginning to raise interest rates, and that they are working on the details of how to go about doing that without raising too much alarm in markets.

This morning’s report so far is that new weekly unemployment claims fell by 14,000 last week to 298,000, about in line with expectations. The four-week moving average rose by 4,750 to 300,750.

Still to come are the PMI Mfg Index at 9:45 am, and the Phila Fed Index, Existing Home Sales, and Leading Economic Indicators, at 10 a.m.

The pre-open indicators have come off earlier highs as PMI Mfg reports from Euro-zone disappointed again.

Our Pre-open Indicators:

Our pre-open indicators are pointing to the Dow being up 20 points or so in the early going.

I’ll be back with the next post on Saturday morning, as usual later than on the week-days, probably around 12 noon.

To read my weekend newspaper column click here:   Bonds Persist in Their Warning About the U.S. Economy

Subscribers to Street Smart Report:

In addition to the charts and signals in the ‘premium content’ area of this blog, there is an in-depth Markets Report (stock market, gold, bonds) from last evening in your secure area of the Street Smart Report website.

Non-Subscribers:

If you haven’t done so yet, check out our new bull market/bear market indicator (BBMI) by clicking here: Market Timing Strategy

SUBSCRIBE NOW! To get all of this:

(The equivalent of four or five normal newsletters at the cost of one)

  • Access to Premium Content area of this Blog, Tuesday, Thursday, and Saturday a.m.
  • A 6-page Mid-Week Markets Report every week.
  • A 4 to 6 page Gold, Bonds, U.S. Dollar Report every three weeks.
  • A 4 to 6 page Global Market Report every three weeks.
  • The 8-page Street Smart Report newsletter every 3 weeks.
  • Hotline Updates whenever signals or recommendations change.
  • Two specific portfolios (Seasonal Timing & Technical Analysis Timing)
  • Sy’s weekly column on markets and the economy every Friday.

Market, sector, stock, gold, bond, and dollar buy and sell signals, short-sales, long-side and ‘inverse’ etf’s, mutual funds. Highly regarded and in our 26th year. As a bonus for a one-year subscription you will also receive my latest book Beat the Market the Easy Way- Proven Seasonal Strategies That Double the Market’s Performance. Click here for subscription information.

This blog appears every Tuesday, Thursday, and Saturday morning!

**** End of Today’s post*****

Rally in European markets finally showed up.

Tuesday, August 19, 9:25 a.m.

I’ve been pointing out for a couple of weeks that European markets, which topped out in June, had become very oversold short-term, which should produce a significant short-term rally.

But it just wasn’t happening. Every time a rally seemed to begin it was hit with another negative economic report, or a flare-up in the Russia/Ukraine situation.

However, at last it has had a couple of days without economic  reports, and news that the Russia/Ukraine situation has cooled off. And European markets have taken advantage of the situation .

081914h

I said that the quality of the first rally attempt after such a plunge would probably be important. Would they be able to rally back above their 50-day moving averages and see the m.a.’s become support again? Or would the moving averages now be overhead resistance on rally attempts as the downturn continues?

Of course it’s too early to tell.

But there is reason for concern given that some of Europe’s major markets already experienced their first rally attempts and the 50-day m.a. was overhead resistance.

081914i

 

081914j

So we shall see. 

To read my weekend newspaper column click here:   Bonds Persist in Their Warning About the U.S. Economy

Subscribers to Street Smart Report:

In addition to the charts and signals in the ‘premium content’ area of this blog, there will be an in-depth Markets Report (stock market, gold, bonds) tomorrow in your secure area of the Street Smart Report website. tomorrow. 

Yesterday in the U.S. Market. 

A very positive day, with the market closing on its high. Volume was average with just under 0.6 billion shares traded on the NYSE.

The Dow closed up 175 points, or 1.1%. The S&P 500 closed up 0.8%. The NYSE Composite closed up 0.8%. The Nasdaq closed up 1.0%. The Nasdaq 100 closed up 0.8%. The Russell 2000 closed up 1.5%. The DJ Transportation Avg. closed up 1.7%. The DJ Utilities Avg closed down 0.1%.

Gold closed down $6 an ounce at $1,299.

The U.S. dollar etf UUP closed up 0.2%.

The 20-yr bond etf TLT closed down 1.0%.

The China etf GXC closed up 0.7%.

European Markets rallied sharply off their oversold condition yesterday.

The Europe Dow closed up 1.0%.

The London FTSE closed up 0.8%. The German DAX closed up 1.7%. France’s CAC closed up 1.4%. Belgium closed up 1.3%. Denmark closed up 1.2%. Finland closed up 0.9%. Greece plunged 2.5%.  Ireland closed up 0.9%. Italy closed up 0.8%. Netherlands closed up 1.1%. Norway closed up 0.1%. Portugal closed up 2.4%. Spain closed up 1.3%. Switzerland closed up 1.0%.

Asian Markets closed up last night.

The Asia Dow closed up 0.6%. Among individual countries:

Australia closed up 0.7%. China closed up 0.3%. Hong Kong closed up 0.7%. India closed up 0.1%. Indonesia closed up 0.2%. Japan closed up 0.8%. Malaysia closed up 0.4%. New Zealand closed up 0.9%. South Korea closed up 0.9%. Singapore closed up 0.1%. Taiwan closed up 1.1%. Thailand closed up 0.1%.

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Markets This Morning:

European markets are up again this morning.

The Europe Dow is up 0.2%.

The London FTSE is up 0.5%. The German DAX is up 1.0%. France’s CAC is up 0.4%. Belgium is up 0.6%. Denmark is up 1.0%. Finland is up 1.0%. Greece is up 0.6%. Ireland is up 0.3%. Italy is up 0.1%. Netherlands is up 0.7%. Norway is down 0.1%. Portugal is up 0.3%. Spain is up 0.3%. Switzerland is up 0.6%.

This Morning in the U.S. Market:

Oil is down $.44 a barrel, at $95.97

Gold is up $1 an ounce at $1,300.

This week’s Economic Reports:

This week’s reports include the first look at the housing industry in a while, and include: the Housing Market Index, New Housing Starts, Existing Home Sales, Consumer Price Index, minutes of the last FOMC meeting, etc. To see the full list and times click here, and look at the left side of the page it takes you to.

Yesterday’s report was that the Housing Market Index, which measures the confidence of Home-Builders, improved from 53 in July to 55 in August, indicating 55% of home-builders are now optimistic, the second straight month with more than 50% optimistic. That is the index’s highest level in 7 months.

This morning’s reports are that the Consumer Price Index remained benign in July, rising only 0.1%, with the core rate also up just 0.1%. And we got good news from the housing industry for the first time in a long while. New Housing Starts jumped 15.7% in July to an annual rate of 1.09 million from 945,000 in June, better than the consensus forecast of 975,000. And permits for future starts rose 8.1% to an annual rate of 1.05 million.

The pre-open indicators, already somewhat positive, picked up more after the reports.

Our Pre-open Indicators:

Our pre-open indicators are pointing to the Dow being up 70 points or so in the early going.

I’ll be back with the next post on Thursday morning at 9:25 a.m.

To read my weekend newspaper column click here:   Bonds Persist in Their Warning About the U.S. Economy

Subscribers to Street Smart Report:

In addition to the charts and signals in the ‘premium content’ area of this blog, there will be an in-depth Markets Report (stock market, gold, bonds) tomorrow in your secure area of the Street Smart Report website. tomorrow. 

Non-Subscribers:

If you haven’t done so yet, check out our new bull market/bear market indicator (BBMI) by clicking here: Market Timing Strategy

SUBSCRIBE NOW! To get all of this:

(The equivalent of four or five normal newsletters at the cost of one)

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  • A 4 to 6 page Gold, Bonds, U.S. Dollar Report every three weeks.
  • A 4 to 6 page Global Market Report every three weeks.
  • The 8-page Street Smart Report newsletter every 3 weeks.
  • Hotline Updates whenever signals or recommendations change.
  • Two specific portfolios (Seasonal Timing & Technical Analysis Timing)
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**** End of Today’s post*****

Europe is being repeatedly hit when it’s already down.

Saturday, August 16, 12 noon.

Tracking with the signals of our short-term technical indicators, European markets topped out in June. The U.S. market topped out into a less severe short-term pullback in July.

Two weeks ago I said they were both oversold beneath their short-term 50-day moving averages to a degree that should bring at least a rally off the short-term oversold condition.

081614l

While that rally is taking place in the U.S. market, Europe’s markets have not been able to get any traction. Every time they get off the floor onto their knees they are hit with more bad news that knocks them down again.

This week it was the reports that the economic recovery in the euro-zone ground to a halt in the 2nd quarter, led by a surprising plunge by Germany’s economy to negative GDP.

However, yesterday morning, European markets tried again to rally off the oversold condition. The German DAX was up 100 points, when the news came that a Russian military convoy had crossed Ukraine’s border and had reportedly been destroyed by Ukraine military forces.

The DAX turned tail and dropped more than 230 points to close down 132 points on the day.

However, regardless of whether this is the beginning of something worse or not, our-short-term indicators are saying the oversold condition should bring at least a rally back up to test the potential resistance at the 50-day m.a.

That expected oversold rally is underway in the U.S. market. 

081614f

 

Other voices – Lots of choices – from one extreme to the other:

From Barron’s: Stephen Auth, chief investment officer, Federated Investors:  “I call the economy "Goldilocks cubed" because we have what actually may be an accelerating economy, with the Fed and Treasury rates well-behaved and perceptions about risk declining. Market valuations depend on growth, bond rates, and perceptions of risk, and all three of those are going in the direction that actually expands the price/earnings multiple. At the same time, earnings are expanding, and that’s a recipe for another leg up in the market.”

Business Insider Australia:It seems legendary hedge fund billionaire George Soros might be souring further in his outlook for U.S. stocks, based on his most recent SEC 13-F filing in the U.S. It showed a 605% increase in his short S&P 500 position (through put options on 11.29 million shares of SPDR S&P 500 ETF) to $2.2 billion . . . . a whopping 16.65% of the total assets in his Soros Funds Management Portfolio.”

Market Watch, Paul B. Farrell: Sometime after the Great Crash of 2016, Fed Chairwoman Janet Yellen will be testifying before Congress, just like Alan Greenspan was forced to do in 2008. She will be explaining why America has already had three mega-crashes in the 21st Century, each draining roughly $10 trillion, each a direct result of Federal Reserve policy failures. She will be forced to explain why the Great Crash of 2016 was a clone of the bank credit crash of 2008 and the 2000 excesses.”

To read my weekend newspaper column click here: Bonds Persist in Their Warning About the U.S. Economy

Subscribers to Street Smart Report:

In addition to the charts and signals in the ‘premium content’ area of this blog, there is an in-depth Markets Update (Stock market, bonds, gold) from Wednesday is in your secure area of the Street Smart Report website.

Non-Subscribers:

Check out our new bull market/bear market indicator (BBMI) by clicking here: Market Timing Strategy !

U.S. market yesterday.

A mixed day, well off lows and well off highs. The Dow was up as much as 65 points, then down as much as 138, but recovered to close down only 50 points. Volume picked up to 0.75 shares traded on the NYSE.

The Dow closed down 50 points, or 0.3%. The S&P 500 also closed down 0.1%. The NYSE Composite closed down 0.1%. The Nasdaq closed up 0.3%. The Nasdaq 100 closed up 0.5%. The Russell 2000 closed down 0.2%. The DJ Transportation Avg. closed unchanged. The DJ Utilities Avg closed up 0.5%.

Gold closed down $10 an ounce at $1,305 an ounce.

The U.S. dollar etf UUP closed down 0.2%.

The 20-yr bond etf TLT closed up 1.1%.

The China etf closed up 0.1%.

Asian markets mostly closed up in their last session of the week.

The Asia Dow closed up 0.4%.

Among individual markets:

Australia closed up 0.3%. China closed up 0.9%. Hong Kong closed up 0.6%. India closed up 0.7%. Indonesia closed down 0.1%. Japan closed up 0.1%. Malaysia closed up 0.2%. New Zealand closed up 0.3%. South Korea closed up 0.1%. Singapore closed up 0.6%. Taiwan closed down 0.3%. Thailand closed up 0.3%.

European markets closed down yesterday.

The London FTSE closed up 0.1%. The German DAX closed down 1.4%. France’s CAC closed down 0.9%. Belgium closed down 0.2%. Denmark closed down 0.4%. Finland closed down 0.2%. Greece closed up 0.7%. Ireland closed up 0.3%. Italy closed down 0.3%. Netherlands closed down 0.1%. Norway closed up 0.6%. Portugal closed up 0.3%. Spain closed down 0.7%. Switzerland closed down 0.8%.

Global markets for the week. 

A nice bounce-back from the oversold condition, but nowhere near as pronounced in European markets as the week’s rally indicates. 

THIS WEEK (August 15)
DJIA 16662 +0.7%
S&P 500 1955 + 1.2%
NYSE 10796 +1.0%
NASDAQ 4464 +2.2%
NASD 100 3987 +2.6%
Russ 2000 1141 +0.9%
DJTransprts 8264 +2.1%
DJ Utilities 549 +1.1%
XOI Oils 1,642 -0.4%
Gold bull. 1,304 -0.5%
GoldStcks 101.97 +0.7%
Canada 15284 +0.6%
London 6689 +1.9%
Germany 9092 +0.9%
France 4174 +0.7%
Hong Kong 24954 +2.6%
Japan 15318 +3.6%
Australia 5559 +2.4%
S. Korea 2063 +1.6%
India 26103 +3.1%
Indonesia 5148 +1.9%
Brazil 55745 +2.1%
Mexico 44629 +1.2%
China 2331 +1.5%
LAST WEEK (August 8)
DJIA 16553 +0.4%
S&P 500 1931 + 0.3%
NYSE 10691 -0.1%
NASDAQ 4370 +0.4%
NASD 100 3888 +0.2%
Russ 2000 1131 +1.5%
DJTransprts 8092 –0.3%
DJ Utilities 542 +0.4%
XOI Oils 1,648 +1.1%
Gold bull. 1,311 +1.4%
GoldStcks 101.26 +1.8%
Canada 15196 -0.1%
London 6567 -1.7%
Germany 9009 -2.2%
France 4147 - 1.3%
Hong Kong 24331 -0.8%
Japan 14778 -4.8%
Australia 5429 -2.1%
S. Korea 2031 -2.0%
India 25329 -0.6%
Indonesia 5053 -0.7%
Brazil 55603 -0.5%
Mexico 44105 +0.3%
China 2297 +0.4%
PREVIOUS WEEK (August 1)
DJIA 16493 - 2.8%
S&P 500 1925 - 2.7%
NYSE 10692 - 2.7%
NASDAQ 4352 - 2.2%
NASD 100 3879 - 2.2%
Russ 2000 1114 - 2.6%
DJTransprts 8120 - 3.7%
DJ Utilities 540 - 2.8%
XOI Oils 1,630 - 3.3%
Gold bull. 1,293 - 1.1%
GoldStcks 99.49 - 2.1%
Canada 15215 -1.6%
London 6679 -1.7%
Germany 9210 -4.5%
France 4202 - 3.0%
Hong Kong 24532 +1.3%
Japan 15523 +0.4%
Australia 5547 -0.5%
S. Korea 2073 +2.0%
India 25480 -2.5%
Indonesia 5088 0%
Brazil 55902 -3.2%
Mexico 43986 -0.9%
China 2288 +2.8%

Premium Content Area.

For Street Smart Report subscribers only, used to provide additional info to that provided in the newsletter, mid-week reports, and hotlines.

NOTE: To gain access call our subscription office at 1-386-943-4081 (week-days only). If you can afford two cups of coffee a week you can afford the cost of 25.95 a month ($6.50 a week). For that you also receive the full Street Smart Report advisory service (newsletter, hotlines, in depth mid-week reports on stocks, gold ,bonds, etc.). Or to subscribe online click here: https://streetsmart.securesites.net/order.html

In the premium content area this morning: Charts and signals on the U.S. stock market, gold, and bonds, signals (long-term, intermediate-term, and short-term), and analysis of each.


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Next week’s Economic Reports:

Next week’s reports include the first look at the housing industry in a while, and will include: the Housing Market Index, New Housing Starts, Existing Home Sales, Consumer Price Index, minutes of the last FOMC meeting, etc. To see the full list and times click here, and look at the left side of the page it takes you to.

To read my weekend newspaper column click here: Bonds Persist in Their Warning About the U.S. Economy

Subscribers to Street Smart Report:

In addition to the charts and signals in the ‘premium content’ area of this blog, there is an in-depth Markets Update (Stock market, bonds, gold) from Wednesday is in your secure area of the Street Smart Report website.

I’ll be back with the next blog post Tuesday morning at 9:25 a.m.

Non-Subscribers:

SUBSCRIBE NOW! To get all of this:

(The equivalent of four or five normal newsletters at the cost of one)

  • Access to Premium Content area of this Blog, Tuesday, Thursday, and Saturday a.m.
  • A 6-page Mid-Week Markets Report every week.
  • A 4 to 6 page Gold, Bonds, U.S. Dollar Report every three weeks.
  • A 4 to 6 page Global Market Report every three weeks.
  • The 8-page Street Smart Report newsletter every 3 weeks.
  • Hotline Updates whenever signals or recommendations change.
  • Two specific portfolios (Seasonal Timing & Technical Analysis Timing)
  • Sy’s weekly column on markets and the economy every Friday.

Market, sector, stock, gold, bond, and dollar buy and sell signals, short-sales, long-side and ‘inverse’ etf’s, mutual funds. Highly regarded and in our 26th year. As a bonus for a one-year subscription you will also receive my latest book Beat the Market the Easy Way- Proven Seasonal Strategies That Double the Market’s Performance. Click here for subscription information.

This blog appears every Tuesday, Thursday, and Saturday morning and at occasional times in between! Follow it via the RSS feed or follow it in Twitter (the ‘handle’ is @streetsmartpost) so you won’t miss any posts.

**** End of Today’s post*****

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