The ‘cat leaped like a tiger’ over the 50-Day Moving Average, and held it with a lot of help from a stronger Dollar, firmer Oil despite ongoing Contango in Brent and certainly the ongoing policies to improve forward US growth.
There are many issues; political, fundamental, technical and even statistical, that pervade presently. Not to mention the obvious sensitivity to geopolitical news, and any hint of progress (or lack) toward healthcare and tax-reform. I hasten to mention we are dealing also with sporadic terrorist attacks, that in a sense are reminders that we’re at war, even as some fret embarking on a different (more conventional and larger catastrophic) war looming as well.
First, as you likely noticed with more official remarks again today; raising or dashing ongoing hopes for expediting any of these important potential new reforms to get-over ‘speed-bumps’, which were and are central to achieving the kind of reform and growth proposed, both by the President during the campaign, and by the Administration and later Speaker Ryan, within earlier stages of debate… they do tend to thrust the markets swiftly.
In the case of today’s moves (which I’ll allude to in the main video); there’s a clear effort to keep the ‘cat on the hot tin roof’ up there on its perch, at least for a bit longer. And the technical significance is really what this is about; not so much earnings; and not so much the politics. Perhaps Oil helped a bit (it did); but the ‘spread’ going forward suggests not very much or for too long.
Really it was the ability we’ve outlined to surmount the S&P 50-day Moving Average (after the prior day’s IBM-led purge); along with NASDAQ new high achievements, that sort of bought time for the market. I suspect that’s all for now that has been accomplished.
Saying that, I’m aware analysts frightened yesterday then suddenly flipping back to the ‘what shall we buy’ mode today, is a bit ridiculous. The market’s no better ‘deal’ today than yesterday; it simply ‘held the line’ technically and ran-in the shorts; and that doesn’t ensure meaningful follow-thru buying.
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