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March 04, 2017 – Weekend Market Comment

March 4, 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).

The markets pulled back this week, as I said last week they would. Thursday was a day of profit taking as all of our major indices retreated with the small cap Russell 2000 taking the biggest hit, falling 1.27%.  During trading the concern was about the anticipated interest rate hike of 25bps on March 15. The worry was that it would NOT happen, since traders were worried the economy is weaker than expected.


Here is what our charts say:






101 Bull Bear
Bull market (dark green over red)  the dark green 50 day average is in a firm uptrend.  NOTICE THE SLOPE (second window), we might be starting another long ride up.  Bull market -- expect bullish outcomes.

103 NYSE High Low Market Forces
Wow breadth is still very strong. Nothing but strength. 

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
2 new up bricks! positive.
!
203 OBV
OBV (red line) is with the market. Bullish!

207 VIX
Fear is way down.

209 VIX Evaluator
Very much bullish.


211 S&P500 over 50 day
Now about 78% of stocks are above their 50 day MA,  up from last week when it was 76%.
!
213 Green Arrow
Only put new money to work when I draw a green arrow. Heading down. Notice loss of TRIX momentum.

!
301 NASDAQ Summation
Nasdaq breadth is rolling over. Pay attention trouble could be brewing.

303 Aggressive Defensive
Clearly defensive.

305 Consumer Bonds vs Equities
Bonds fail. Get used to this in a rising rate environment. Consumer stalls

307 Bond Direction
Bonds sideways moving average. 
!
309 Sectors
Everything is doing well but consumers. Bazaar.

311 Nations
bounce for Canada?

313 Major sectors
not much here -- all about the USA.

! = Pay attention this chart is important this week.



What I Find Interesting


Sugar is Killing You
I wrote this im my thoughts blog click hear to view. Sugar is a man made toxic chemical and likely is more dangerous to your overall health than any other food you routinely ingest. You have been purposely feed a lot of misinformation by a powerful lobby organization called the Sugar Association, formerly known as the Sugar Research Foundation. We have been duped by the packaged food industry into a lifestyle of foods that cause us to look and feel terrible. It is far worse than any of us believed and I think you will find the information below both eye opening and deeply concerning. click hear to view




Wall Fail
A Mexican congressman has gone to new heights to mock President Trump’s plans for a “big beautiful wall,” in a stunt designed to show how easy it is to climb the oft-touted structure. “I was able to scale it, climb it, and sit myself right here,” Braulio Guerra, a representative from the state of Querétaro, said in a video, as he sat atop a 30-foot-high fence along a Tijuana beach.


Computer Card Shark

Computer scientists from the University of Alberta in Canada report that their program, known as DeepStack, roundly defeated professional poker players, playing 3,000 hands against each. The program didn’t win every hand — sometimes the luck of the draw was against it. But after the results were tallied, DeepStack beat 10 out of 11 card sharks, the scientists report online March 2 in Science.

Poker is the quintessential game of imperfect information, and it has been a longstanding challenge problem in artificial intelligence. In a study involving dozens of participants and 44,000 hands of poker, DeepStack becomes the first computer program to beat professional poker players in heads-up no-limit Texas hold'em.



What Works Now
Fat People

Weight Watchers (Ticker:WTW)


Das Bank

Germany remains strong and banking is doing well. Deutsche Bank (Ticker: DB)



What I Think

Bull market expect bullish outcomes. Consumer weakness is a concern. Weakness in consumer stocks isn’t new this year. While still the bull market’s leader, the group is the S&P 500’s second-worst performer in 2016 with a gain of just 1.3 percent, on pace for its weakest year since 2008. Similarly, groups of homebuilding and home-improvement stocks are on track for their worst years in a comparable period. Of concern are poor earnings from Apple, Under Armour and Macy's. Don't panic yet but along with housing, these consumer goods firms are the backbone of the U.S. economy. 

On Friday the Federal Reserve announced this:

"Since monetary policy is only modestly accommodative, there appears little risk of falling behind the curve in the near future, and gradual increases in the federal funds rate will likely be sufficient to get to a neutral policy stance over the next few years."

That is just what the street wanted to hear. I would not be surprised to see a rally on Monday, but beyond that the news is less than great. Many worry that Trump infrastructure projects, military expansion and tax cuts will be watered-down in compromise as the plans hit the congress. We know the president can talk a good story but will it keep this bull market alive?

I continue to be long but defensive. 





You can learn more about my indicators by visiting the CME4PIF school by clicking here.


Don't squint, All graphics can be enlarged by click on them.


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Yet another parabolic up week for the markets. Honestly folks valuations are really stretched here. The air is so thin at this altitude. Then again the markets can and do (on a short term basis) anything they want. Still I would expect a little pull-back in the next two weeks.


Lets see what is in the charts this week:

CLICK HERE: To see the 100 and 200 series charts



101 Bull Bear Bull market (dark green over red) and now the short term (light green) is up sharply. Also note the dark green 50 day average is in a firm uptrend. NOTICE THE SLOPE (second window), this could be part of a new long term uptrend.Bull market -- expect bullish outcomes…