Tuesday, May 3, 2016

Monetary policies around the world

  • US: only developed country whose last move was a rate hike.
  • Japan/Eurozone/Sweden/Norway/Australia all cut in '16.

Wednesday, April 27, 2016

Market update: S&P 500 (27 Apr 2016)

The Federal Reserve is keeping a key interest rate unchanged against the backdrop of a global economic slump and providing no hint of when its next rate hike may occur. A statement the Fed issued after its latest policy meeting notes that the United States is enjoying solid job gains despite a slowdown in growth. The Fed says it also expects inflation to move toward its 2 percent target from persistently low levels.

3-day SPY

10-month SPY

Thursday, April 7, 2016

Market outlook : Dow Jones (7 Apr 2016)

The red shaded area shows a resistance zone where rallies have died since the heavy volume August selling. The Dow Jones was beginning to test that price resistance zone when the negative divergence emerged, signaling slowing momentum to the upside. That's key here because the rising 20 day EMA has continually offered solid support for the bulls while momentum was accelerating to the upside. Now it's being challenged, but with slowing momentum more apparent.

Dow Transports send warning signal for S&P 500

Airlines, railroads and other transportation companies are sending “a warning signal about another change in trend” for U.S. stocks, Matt Maley, an equity strategist at Miller Tabak & Co. LLC, wrote Thursday in an e-mailed note to clients.

The Dow Jones Transportation Average dropped 4 percent through Wednesday from this year’s high, set March 18, and extended its decline in early trading on Thursday. The 20-stock average rallied from its 2016 low about three weeks before the Standard & Poor’s 500 Index followed suit.

Wednesday, March 30, 2016

Yellen rally hits day 2, sending stocks to 2016 highs (30 March 2016)

Federal Reserve Chair Janet Yellen's dovish tone in a Tuesday speech appeased global markets by assuring a 'cautious' path to normalization.

Wall Street celebrated the second day of the Janet Yellen rally Wednesday as stocks closed at 2016 highs again following the Federal Reserve chief's market-friendly speech that stressed the U.S. central bank is in no rush to increase interest rates.

The Dow, which closed up nearly 100 points Tuesday after Yellen's dovish speech, gained another 84 points, or 0.5%, to close at 17,717 Wednesday. The broader Standard & Poor's 500 stock index was 0.4% higher and the Nasdaq composite gained 0.5%. Both the Dow and S&P 500 have closed at 2016 highs two consecutive days and have more than completely wiped out losses from the worst start to a year ever for stocks.

With one trading day left in the first quarter, the Dow is up 1.7% for 2016 and the S&P 1.0%. Only the Nasdaq remains in the red for 2016, down 2.8%. This is a stark turn from the dark days of early February, when the three major U.S. indexes had 2016 losses ranging from 10% to 15% when the market hits its low for the year.

Yellen, who said it is prudent for the Fed to "proceed cautiously" in its push to normalize interest rates, powered a global stock market rally. Aside from a drop in Japan, stocks rallied sharply in Hong Kong, mainlaind China, India, Australia, London, Germany and Paris.

SPY daily; 30 March 2016

Friday, March 25, 2016

Dollar index still in a downtrend (3/24/16)

Despite this week’s oversold bounce, the medium-term downtrend remains healthy: the RSI indicator is still trapped in a bearish range below the 60 level, and though the daily MACD indicator is showing signs of turning higher, it’s still well below the “0” level, showing overall bearish momentum. As long as the dollar index holds below its previous highs in the 98.50 zone (roughly equivalent to the 1.13-14 area in EUR/USD, the technical downtrend will remain intact.