It’s Going To Be A Volatile Year

Why?  Check out this stat, courtesy of Ryan Detrick:

The S&P 500 was up over 5% in January but could finish the first quarter in the red.

That only happened one time in history, in 1980.

S&P 500 was up 25.8% in 1980.


Demand For Unemployment Benefits Continue To Drop


Key part:   The numbers: Initial U.S. jobless claims rose by 3,000 to 229,000 in mid-March, but they remain near the lowest levels since 1970. And the number of people collecting benefits fell to a fresh 45-year low.

Economists polled by MarketWatch has forecast claims to total 225,000 in the seven days ended March 17. The level of claims gives a rough idea of how many people are losing their jobs.

The more stable monthly average of claims increased by 2,250 to 223,750, the government said Thursday.

The number of people already collecting unemployment benefits, known as continuing claims, fell by 57,000 to 1.83 million. That’s the lowest level since December 1973.

Hat tip

SP500 Futures

Hard to argue that this doesn’t look like a technical top until and if it trades back above 2800 on the SP500 Futures

Screen Shot 2018-03-22 at 9.34.43 AM

Leading Indicators Post 5th Straight Advance

The lede from 

What happened: The index rose for the fifth straight month, and eight of the 10 indicators that make up the leading index advanced. The biggest help came from average weekly manufacturing hours. Building permits and stock prices were the only drags.

In the six months ending February, the leading index has climbed 4%, faster than the 2.4% growth during the prior six months.

The big picture: The gains suggest an economy with real momentum. Job market data continue to be strong, and consumer and business confidence are, for the most part, robust.

What they’re saying: “The LEI points to robust economic growth throughout 2018. Its six-month growth rate has not been this high since the first quarter of 2011,” said Ataman Ozyildirim, director of business cycles and growth research at The Conference Board.

Small Town America Makes A Comback

The Lede:    The new numbers, scheduled to be released Tuesday by the Metropolitan Policy Program at the center-left Brookings Institution, show that job growth in 2017 remained heavily concentrated in the largest cities benefiting the most from the transition to the information-age digital economy.
But smaller communities, lifted by higher prices for oil, gas and other commodities and some gains in manufacturing, last year clawed back a significantly larger share of new job creation than in the final years of Barack Obama’s presidency, the analysis found. While this economic revival in Trump country so far has been driven mostly by cyclical changes in global markets, particularly for energy, Trump can plausibly argue that his agenda of promoting domestic manufacturing and oil and gas production can help sustain those gains in the non-metropolitan places that disproportionately house those industries. And that could create another electoral obstacle for Democrats in smaller communities, where the President has also connected far better culturally and stylistically than in urbanized areas.
Rollbacks matter…
Read the whole thing:


Possibly a run at resistance = 1340.  Not bad here – better w/ a close above 1340.  Want to see last week’s lows hold on a closing basis.

Screen Shot 2018-03-21 at 3.24.11 PM

Fed Raises Rates, More Hikes To Come

The Federal Reserve voted unanimously to raise interest rates during new chairman Jerome Powell’s first meeting.  The lede from 

The Federal Reserve said it would raise short-term interest rates a quarter-percentage point and signaled it could lift them at a slightly more aggressive pace in coming years to keep the strengthening economy on an even keel.

Fed officials said they would increase their benchmark federal-funds rate to a range between 1.5% and 1.75% and penciled in a total of three rate increases for this year.

But compared with December, more officials think they will need to raise interest rates at least four times this year if the economy performs in line with their expectations. Seven of 15 participants now expect at least four rate increases this year, an increase from four of 16 participants at the December meeting.

Most Fed officials also expect the Fed would need to raise rates at least another three times next year. At the December meeting, officials projected around two increases would be needed in 2019.
Read the whole thing:




Leaving In Droves, Part 2, California Edition


From  Census Bureau data show California lost just over 138,000 people to domestic migration in the 12 months ended in July 2017. Lower-cost states such as Arizona, Texas, and Nevada are popular destinations for relocating Californians.

Housing costs and the tax burden is far less impactful in pretty much any place outside of California, whose socialist policies drive up poverty and continuously erode the middle class leaving only the extremely wealthy and those in abject poverty.

USC Dornsife/Los Angeles Times Poll of Californians last fall found that the high cost of living, including housing, was the most important issue facing the state. It also found more than half of Californians wanted to repeal the state’s new gas tax, which raised fees by a whopping 40 percent further burdening those already living paycheck to paycheck.

Read the whole thing:

Here’s the link to Part 1, Leaving In Droves:

Crude Breakout?


Big day for USO(United States Oil Fund).  The index finished the session with a 2.1% gain after a gap higher open pushed it to new March highs.  This breakout type move has set crude up well for more upside.  Similar setups, back on Oct. 27 and December 26, sparked powerful rallies.  Considering the USO has quite a long way to travel before returning to overbought territory, a fresh bull move could carry the index well past the $13.30 area(2018 high).  In the near term we consider the USO a low risk buy near current levels.  A close back below $12.00 would violate last week’s low sending a clear warning sign that more range bound trade is ahead.

At time of publication we are long USO in some managed accounts.



Return top

* * * *

Welcome fellow traders and investors!

As Money Managers and Traders, the mission of our Blog and Radio Show is to go on record and further educate our readers and listeners in technical analysis and proper money management across all asset classes.

Our methods are not the traditional advice you hear repeated and repackaged over and over again, but that’s exactly the point and the reason why we know how to advance and prosper in every kind of market.

To Your Success,

Doug & Gary