Archive for the ‘Chart of the Day’ Category

NKE

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Pessimism Rising

Sentiment

From AAII(American Association of Individual Investors):   Pessimism among individual investors about the short-term direction of stock prices is above 40% for just the second time this year. The latest AAII Sentiment Survey also shows a large drop in optimism and a decrease in the percentage of investors describing their outlook as neutral.

This is good news…

Mind The Breadth

The markets internals continue to show strength.  The NYSE Advance/Decline line continues to move steadily higher.  This breadth indicator has done a great job of forecasting bear markets in the past:

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More on the A/D Line:  Advance-Decline Index:   This indicator, also known as the AD line, calculates the difference between advancing and declining stocks. Traders typically look for divergence between the indicator and a major market index, such as the Standard & Poor’s 500 index (S&P 500). For example, if the S&P 500 is rising and the AD index is falling, it indicates the current uptrend may be losing its momentum. On the other hand, if the S&P 500 is falling and the AD index is rising, it suggests that the move lower may be about to reverse.

Hat tip Ryan Detrick/Investopedia.com

FANG Update

All holding the 50 day (orange line) so far.

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The Atlanta Fed’s GDPNow Forecast

Remains at 4.5%:

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Quite a jump from the Obama years which had an average annual GDP growth of 1.48% during two terms… the only President to have not had even one year of 3% GDP growth:

 

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Rollbacks matter…

Hat tip Zerohedge.com

Crude

Daily Chart of Crude.  On a tear for two weeks.

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Five Year Decline

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Is this right time to be long commodities?  We believe exposure to this sector should be part of a diversified portfolio. 

Hat tip  Columbia Management

 

New Lows, Again

The Bloomberg Agriculture Index continues to fall…

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A huge opportunity will develop here.  Timing a bottom is near impossible but it will happen. 

Hat tip The Daily Shot

A Plan For Prudential

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Prudential Financial reached a new all-time high in January of this year after a powerful rally off the September 2017 lows.  In early February PRU was under extremely heavy pressure after leaving behind an ominous weekly downside reversal as January came to the close.  The stock has been struggling since as the 200 day moving average provided strong resistance.  In early May a fresh down leg began(post earnings)that eventually drove shares below the 2017 lows.  At mid year PRU is beginning to show signs of a major bottom.  For patient investors a very low risk buying opportunity is developing.

Trading notes:  The weekly MACD indicator has returned to oversold levels.  The daily MACD has been tracing out a divergent low since February.

Selling pressure has eased of late despite shares sitting close to multi-year lows.

The major support zone just below current levels includes the 2013, 2014 and 2015 highs($94.30-$92.60).  The 2018 low was set last month($94.50).

PRU’s 40 week moving average rests just above $92.00.  The last time PRU tested the 40W was back in September of 2016, a major low.

We consider PRU a low risk buy between $95.00 and $92.00.  A close below $90.00 would be a clear warning sign.

At time of publication we do not have a position in PRU.

 

 

PFE

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