Saturday, 29 April 2017

April 29, 2017 – Weekend Market Comment

April 29, 2017 – Welcome to my weekend market comment, an analysis tool I use in my own portfolio decisions, published free to the web every weekend before the New York opening bell. You can read the latest version each week by bookmarking http://cme4pif.blogspot.ca/. For full details read my disclaimer (link at the bottom of this page).

Stocks followed through this week with small-caps and large-techs leading the charge. Large-techs and QQQ have been leading the market all year. Small-caps were lagging the market from January to mid April, but turned it around the last two weeks as the S&P SmallCap iShares surged to a new high.


Here is what our charts say:






101 Bull Bear
Bull market (dark green over red)  the dark green 50 day average is in a flattening uptrend.  NOTICE THE SLOPE (second window), we might be starting another new slope upward.  Bull market -- expect bullish outcomes.
!
103 NYSE High Low Market Forces
Breadth lines are firmly up. 

105 Non Farm Payroll
Lots of jobs! But beware this is lagging indicator. The smart money is gone before this turns down.

107 Industrial Production
Flat but strong industrial production.  That is good news.

115 Renko
Sideways consolidation, possible overhead resistance at this level. CAUTION.
!
203 OBV
OBV (red line) is below the market.  This is a big problem, if volume does not pick up soon this rally will fail. CAUTION

207 VIX
Fear craters... hmmm wow that is confidence.

209 VIX Evaluator
All good again.


211 S&P500 over 50 day
Now about 58% of stocks are above their 50 day MA,  up a nudge from last week when it was 57%.

213 Green Arrow
Only put new money to work when I draw a green arrow. Notice loss of TRIX momentum. 

!
301 NASDAQ Summation
Nasdaq breadth is returning. Pay attention -- could be volatile.

303 Aggressive Defensive
Aggressive but getting tired.

305 Consumer Bonds vs Equities
Bonds fail. Consumer big boost. BULLISH!

307 Bond Direction
Bonds still trending up, just not recently.

309 Sectors
Defensives and banking lag. BULLISH!

311 Nations
Germany rebound! Canada bounces on bottom of range.

313 Major sectors
Commodities fall


! = Pay attention this chart is important this week.



What I Find Interesting

Save that Vino
In France a cold spell nearly devastated vineyards in some of the country's most famous wine regions, including Bordeaux, Champagne and Burgundy. The weather has posed a severe threat to the annual harvest. Winegrowers in central France have had a busy few days trying to rescue their crops from frost, which is unusual for this time of year. To save the vines from the chill, winegrowers brought in hundreds of oil burning heaters, that they placed across the vineyards.


What Works Now
Microprocessor Chips 
Advanced Micro Devices (Ticker:AMD)

I have noticed this year many tourists caring laptops and over tablets as power users hang on to the bulk for power applications. The big processor is still important and Intel's arch rival still makes a nice bottom line. More importantly is the steady curve up. 

Memory Chips
Micron Technology (Ticker:MU)
recommended here many many times. . . 

Switzerland
Swiss ETF (Ticker:EWL)



What I Think

I think we are in a cyclical bull market (since February 2016) within a near record long, secular bull market (since early-2009), and neither show signs of abating. 

I cautioned last week against betting against the bull and now you know why.   It all looks really strong, except the OBV volume (chart 203) is not there, that means the big boys are late to the party or this is a sucker rally. Also the VIX fell vary hard very fast, you know when everyone is confident, get nervous. That said, for now the market's path of least resistance remains higher in the short- to -medium time frame, and higher in the long-term time frame. It is positive to see small-caps and the consumer discretionary sector leading the market. All I can say is WOW Baby!




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