Mushy day yesterday but no more real damage after Friday.
Yesterday, we told you the usual that we tell you at the end of every quarter: “This week is end-of-quarter, window dressing week. Of course, window dressing is illegal so does not happen. It usually has a positive bias but right now, lots going on.” TODAY…we walk into a big gap to the upside. Rates ticking back up a wee bit.
Again, another big gap to the upside as we enter not end-of-month but end-of-quarter.
There has been some decent damage in a bunch of areas, namely the FINANCIALS. Leading growth names have pulled in hard but still above support and moving averages. More and more easy money talk pervades the air. REMEMBER, we are in the 100% camp that the next move will be the lowering of rates by Powell.
A little reversal yesterday but not a biggie but a few things noteworthy.
TRANSPORTS still aint happening and now a name like UNP rolls over. FDX hit hard this morning not going to help.
FINANCIALS were edging out of range but by the close, tucked their head in like a frightened turtle.
Notice how AAPL pulling back…pulled back the NASDAQ. Nothing wrong if it pulls back some more.
HOUSING aint happening. Small and mid still lagging decently.
Why do we mention these areas? Because it is easiest to isolate weakness when a market is ascending.
Fed day today…blah blah easy money!
BOEING (BA) is down $9 this morning. We receive a decent amount of emails each day on our thoughts. Our answer to all is that “WE DON’T KNOW!” People actually get mad when we tell them we just don’t know. We don’t know:
What kind or what size lawsuits there will be.
How long it will take to get the planes back in the air.
How much it will cost to get the planes back in the air.
How many, if any orders will be cancelled.
What kind of government investigations there will be…and there will be investigations on this plane’s approval.
And of course, how the market treats all this. We know there have been some good trading moves both up and down. We know pundits are coming out in droves telling you what kind of value the stock is at these levels. (THEY DO NOT KNOW)
We just do not know the day to day. We can continue to look at support levels. We can look for accumulation and distribution but that can change overnight because of the news.
As always, it is your money.
We write less in better markets because it is mostly in bearish markets we separate from the pack. Remember, wall street is a fully invested, fed driven vehicle. With the central banks, we suspect you could clip off several thousand, if not more points.
The most important part of the equation remains a clear lack of institutional selling. It can start coming out of nowhere but even in the down week, it was just a pullback and we easily segued off the negative side on the Friday reversal two Friday’s ago.
The SEMIS are on the move.
The FINANCIALS set up here.
NEW HIGHS have been picking up but still not even close to very good.
RUSSELL 2000 weak.
While better, FOREIGN MARKETS not even close to the U.S. The best markets are strong worldwide markets.
Bullishness and froth are showing up with some huge IPOs coming out.