Saturday, 25 February 2017

Weekend update - US weekly indexes

It was a somewhat mixed week for the US equity market, with net weekly changes ranging from -0.8% (Trans), +0.1% (Nasdaq comp'), to +1.0% (Dow). Near term outlook offers another push higher of at least 1-2%. If the energy sector starts to participate, then the US market will continue to broadly climb into late April/early May.

Lets take our regular look at six of the main US indexes


It was a fifth consecutive net weekly gain for the sp'500 (the best run since March 2016), with a new historic high of 2368, settling +16pts (0.7%) at 2367. Underlying MACD (blue bar histogram) cycle ticked higher for a third week, and is clearly on the high side. The key 10MA is at 2295, and will be in the low 2300s across early March. Upper bollinger is at 2387, and will be offering the 2400s next week.

Best guess: further upside to around 2400. There will be high threat of a 5% retrace across March/April. Rising trend will be around 2250 in early April, and thus no price action in the low 2200s can be expected this spring/summer.

If the energy sector joins the 'main market party', then there will be no retrace until at least May, and by then, the market will be pushing for the 2500s.

Nasdaq comp'

The tech saw a fractional net weekly gain of 6pts (0.1%), settling at 5845, with a notable new historic high of 5867. First rising trend will be around 5600 in early April, with the 10MA offering support in the 5700s in early March. Core support is at the giant 5k threshold, and frankly, that looks secure for the rest of the year. Talk of 7000s by year end should have already begun.


The mighty Dow keeps on pushing, with a third consecutive net weekly gain of 197pts (1.0%), settling at 20821, having broken a new historic high of 20840. The 21000s are due in the near term, and its interesting that there is increasing chatter of a straight run to the 22000s.. even 23000s by mid/late summer. If the Dow can keep pushing to the 21250/500 zone, then first soft support at the giant 20k threshold will hold across the spring.. if not the rest of the year. Talk of a year end 'hyper bullish' close within the 24/25k zone can begin.

NYSE comp'

The master index saw a moderate net weekly gain of 0.3%, but also managed a new historic high of 11590. The upper weekly bollinger is already offering the 11700s, with the 12000s seemingly now viable by late April/May. Things only turn provisionally bearish if the NYSE comp' is under 11k.


The second market leader - R2K, saw a net weekly decline of -0.4%, but there was still a new historic high of 1410. Its notable the upper bollinger is offering the 1470s, and that will increase to the 1500s by mid March. Things only turn provisionally bearish with price action under the 1300 threshold.


The 'old leader' - Transports, was the laggard this week, with a net weekly decline of -0.8%. The tranny was the only index that didn't break a new historic high this week. Of course, one net weekly decline doesn't negate the broader trend, which is unquestionably still very bullish. Upper weekly bollinger will be offering the giant 10k level in March... which if achieved, would be a massive achievement for the equity bulls, with the Trans having climbed from a March 2009 low of 2134.


The US market continues to broadly climb, with the Dow now leading the way higher.

All indexes are still regularly breaking new historic highs.

The market could fall 2-3%, and that would only test the (still rising) weekly 10MAs.

Equity bears have nothing to tout unless the Nov2016 lows are taken out. Other world markets (most are mid term bullish), are highly suggestive there will be no retrace in the US market until at least May.

Looking ahead

M - Durable goods orders, pending home sales,
T - GDP (second estimate), intl' trade, Case-Schiller HPI, Chicago PMI, consumer con', Richmond fed'

*President Trump will present the 'State of the Union' address in the evening. That will be an immensely important event, not just for the US.. but the world. The speech should at least raise the issues of infrastructure and tax policy/regulations, which the market will extremely interested in.

W - Vehicle sales, pers' income/outlays, PMI/ISM manu', construction, EIA report, Fed beige book
T - Weekly jobs
F - PMI/ISM serv' sector

*there are a considerable number of fed officials on the loose, notably Bullard (Tues' evening), and Yellen (Fri', 1pm).

**It is highly likely that SNAP will be listed in the latter half of the week. That will naturally garner a lot of media/market attention, and it'll be important for the equity bulls to see that IPO proceed smoothly.

Gold Miners Report

For those with an interest in the gold miners and precious metals, I have something new to offer.

For details:

As ever, if you value these posts, then subscribe to me!

Have a good weekend

*the next post on this page will appear Monday at 7pm EST