WEEKEND MARKET NOTES
We continue to believe this remains a very split tape…regardless that some major indices are in new high ground.
Bounces aside…and to be clear, all these areas are deeply oversold…we continue to avoid:
Gold/silver, real estate, utilities, beverages, food, household products, tobacco,emerging markets, apparel, medical supplies,medical equipment, pharma, solar, big telecom, big cap tech/internet (Facebook, Google, Alibaba, Amazon and throw in Tesla. On top of that, many foreign countries continue to under-perform and lastly our technical call on the bond market remains in force as the bond bear remains in force.
But…notwithstanding pullbacks (which eventually will happen), extended financials, insurance, managed care, investment brokers, steel, airlines, transports, rails, industrials and semiconductors remain the bull of the woods. Just keep in mind, they are quite overdue to pull in where one can take a look at them.
Lastly, watch them oils…not all but many are sitting in what we believe are great looking bases. A breakout of range will add another group to the positive column.
Notice the less words on major indices. This is a sector by sector game right now off of the election.
Yoda adds,,,, 2 cents….
It’s the dollar:
If the badly extended dollar rallies up, the market will fall down,,, …..a little.
If the badly extended dollar falls down, the badly extended market goes a little higher, and with it, commodities.
Gold:
Dollar down, gold up.
Dollar up, watch gold for support.
Q:
Will the dollar break up again ?
A:
Dunno….
I’d stay out of a dollar long, butt;
,the safer bets are on an extended dollar falling:
Dollar fall:
Short the dollar.
Long the Swiss frank.
Long gold
Keeping eyes peeled for a long; dcb, ( dead cat bounce ) on the 10 year bond.