Weekend August 26, 2017

Stocks

Breadth continues to decline, the emphasis is on the large caps, especially the FAB FIVE tech stocks. Transports weakening, the problems at CSX not helping that index.

 

Transports

On balance volume has been declining since lat February. Price has turned below the 10 week moving average. It would take a weekly close under 8750 to really change the trend to down.

Energy

XLE Energy Producers

The ten week MA has been resistance for XLE all the way since the high in December. There is some previous support here at 60-62 but  it had better happen pretty quick.

XES Energy Service

We mentioned last week that the failure of Energy Service to rally was a concern. Things are not going to improve until there is renewed confidence in the service companies.

XES is already re visiting the February 2016 low thought XLE is not. Some negative mood on energy service.

XES Daily

On balance volume in the lower panel needs to pick up. The blue line in the main panel is the downtrend. That would have to be breached to iprove things.

XME Metals and Mining

XME is leading the way for a recovery and final bottom in commodity prices. Note PMO turning up in bottom panel.

CRB

CRB has moved above two of he MAs, that is a great start.  PMO at bottom is slowing turning I think to the upside.

Freeport McMoran, a copper and metals producer has moved up nicely from 11-15.75 since June.

Natural gas futures have traded sideways all summer. We wait for a break out there as well.

So for now Transports have that August season weak look as does Russell 2000.

The low in commodities is slowly unfolding with copper leading, XME improving and energy lagging. Watch energy service for signs of a turn around.

Social Mood

Donald Trump continues to stick his finger in the Progressive Eyeball.The latest was the rant in Phoenix followed by the Pardon of Sheriff Joe.

The media provides cover for ever more outrageous, unhinged acts like the Kathy Griffin's severed Trump head, and that let's the left know just how far it can go.

It is hard to see how provoking McConnell, Ryan, and McCain, whose votes he needs, is accomplishing his agenda. Brinksmanship works with enemies, not so much with those who should be friends.

Social Mood Moves Markets

Matt Lampert menioned my work in his latest article which apepars on The Hill website.

 

denislelam@gmail.com

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