The major averages closed mixed yesterday on lower volume, but managed to finish near their intraday highs suggesting support and a continuation of the uptrend. Sizeable gains have been made by a number of leading stocks over the last few days. The S&P 500 outpaced the NASDAQ Composite as oil exploration, homebuilder, lodging, and paper groups all rose more than 1%. On the one hand, strong economic data out of the US, China, and Germany point to economies turning the corner. On the other hand, the most recent unemployment report indicates weakness, thus even if the Fed begins to taper sooner than later, it may be done in such a way to have minimal impact on upsetting the recovery.
Precious metals are down again today, with both gold and silver down sharply, a sign that tapering is near. As the global economy has shown signs of strength, diminishing quantitative easing could come not just from the Federal Reserve but also from the Bank of England and the European Central Bank.
Apple (AAPL) gapped lower and currently rests at its 200-day moving average. Such negative technical action bodes poorly for the stock. Yesterday saw no actionable buy points emerge in leading stocks, a sign that many are extended. Thus investors might look for some consolidation and digestion of prior gains here as the market heads into next week's key Fed policy meeting and announcement next Wednesday.
This information is provided by MoKa Investors, LLC DBA Virtue of Selfish Investing (VoSI) is issued solely for informational purposes and does not constitute an offer to sell or a solicitation of an offer to buy securities. Information contained herein is based on sources which we believe to be reliable but is not guaranteed by us as being accurate and does not purport to be a complete statement or summary of available data. VoSI reports are intended to alert VoSI members to technical developments in certain securities that may or may not be actionable, only, and are not intended as recommendations. Past performance is not a guarantee, nor is it necessarily indicative, of future results. Opinions expressed herein are statements of our judgment as of the publication date and are subject to change without notice. Entities including but not limited to VoSI, its members, officers, directors, employees, customers, agents, and affiliates may have a position, long or short, in the securities referred to herein, and/or other related securities, and may increase or decrease such position or take a contra position. Additional information is available upon written request. This publication is for clients of Virtue of Selfish Investing. Reproduction without written permission is strictly prohibited and will be prosecuted to the full extent of the law. ©2018 MoKa Investors, LLC DBA Virtue of Selfish Investing. All rights reserved.