What Market's Are Doing Right Now
Updating four of our favorite assets:
Stocks
Continuing bear market rally. Of note, the S&P broke through resistance at 2020, closing on Friday at 2022.19. Interestingly it closed Monday at 2019.64, a hair below resistance. So we wonder: Was that break through resistance one of those weak penetrations that fall right back below? Monday's close doesn't really answer the question, as it too was weak action. Volume on Friday's was stronger than Monday's pullback. But, again, not really definitive. That means we'll find out more this week. What we're looking for is any sign that this bear market rally is going to break out to new highs, or fall back such that the bear now inserts itself again.
Bonds
We're looking at the long treasury bond. If you follow the ETF TLT (20+-year treasuries), you see that it's been significantly above its moving averages, specifically the 50-day and the 200-day, the first part of 2016. It leveled off a bit, and now has drifted down. But really nothing definitive yet. The correction of its rising price hasn't been particularly strong. For all we know, it could drift more or less sideways in a resting mode until it catches its breath and gets ready to rise again - which we expect it do at some point. Of course, we're vigilant for any evidence that the continued rise of the 30-year treasury might be in jeopardy. We don't see that so far.
Gold
Gold, along with the long treasuries, was another go-to place as the stock market tumbled first part of 2016. Now, as stocks rally, gold has also corrected - much stronger Friday and again yesterday. It's still, however hovering high above its averages, so if its going to really take a rest, it will either fall more or just meander for a number of days or weeks. If it's to pick up steam, it'll likely do that after consorting with its buddy, the long treasury. Perhaps they've both kicked up their heels and are having drinks on some lovely tropical isle as we speak.
Cash
Ah, what can one say about cash besides: It pays nothing. And so it continues to do just that.
Stocks
Continuing bear market rally. Of note, the S&P broke through resistance at 2020, closing on Friday at 2022.19. Interestingly it closed Monday at 2019.64, a hair below resistance. So we wonder: Was that break through resistance one of those weak penetrations that fall right back below? Monday's close doesn't really answer the question, as it too was weak action. Volume on Friday's was stronger than Monday's pullback. But, again, not really definitive. That means we'll find out more this week. What we're looking for is any sign that this bear market rally is going to break out to new highs, or fall back such that the bear now inserts itself again.
Bonds
We're looking at the long treasury bond. If you follow the ETF TLT (20+-year treasuries), you see that it's been significantly above its moving averages, specifically the 50-day and the 200-day, the first part of 2016. It leveled off a bit, and now has drifted down. But really nothing definitive yet. The correction of its rising price hasn't been particularly strong. For all we know, it could drift more or less sideways in a resting mode until it catches its breath and gets ready to rise again - which we expect it do at some point. Of course, we're vigilant for any evidence that the continued rise of the 30-year treasury might be in jeopardy. We don't see that so far.
Gold
Gold, along with the long treasuries, was another go-to place as the stock market tumbled first part of 2016. Now, as stocks rally, gold has also corrected - much stronger Friday and again yesterday. It's still, however hovering high above its averages, so if its going to really take a rest, it will either fall more or just meander for a number of days or weeks. If it's to pick up steam, it'll likely do that after consorting with its buddy, the long treasury. Perhaps they've both kicked up their heels and are having drinks on some lovely tropical isle as we speak.
Cash
Ah, what can one say about cash besides: It pays nothing. And so it continues to do just that.
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