The Senate acquitted President Trump this week ending the impeachment saga and China reduced tariffs on $75 billion dollars of US exports. Equity markets loved it, closing up over +3% on decent volume.
The overall picture for equities is still murky despite the move to all-time highs in the , the , and the .
The looks like it's heading to par against the dollar and could be an early sign that the EU could implode sooner than some expect.
This Past Week’s Highlights:
Utilities, and Risk Off plays underperformed, confirming strong price actionGrowth stocks continue to lead value and the ratio is hovering at decade plus lowsThe S&P 500 had a Doji day as it climbed to new highs which is inconclusive on future directionRisk Gauges are still showing Risk Off despite the run up to new highsReal Motion indicators did not confirm price action on both daily and weekly charts in both the and the S&P 500Market Internals continue to diverge from bullish price actionVolatility firmed holding above both its 50 and 200-day moving averagesEnergy continues to weaken and hit new lowsThe Euro is under extreme pressure and looks ready to test par with the dollar as Britain finally BrexitedGold is stuck in a 5-week trading range and a breakout either way could have some serious follow through.Semi’s are still the leading sector, but they have a major momentum divergence if they break under recent lows. If SMH does break it will signal a major market top.Looking at this week’s highlights, it’s clear that we are getting some very mixed signals about the next move in the market.
Our sense is that the next move will be a very large one from current levels. Therefore, it is particularly important to watch all key indicators.
