Weekend Sept 17, 2017
Social Mod
A writer at CNBC suggests that traditional political parties are finished.
This is surely the most important insight I have seen lately. In addition let's stipulate that Trump is the first independent to ever win the Presidency. Sure he did it via the Republican party that has done so well at the State level the last few years, some 900+ Democrat seats lost.
But this is something TR, George Wallace, and Ross Perot never accomplished. Eight months in we have zero Republican legislation. And
with the Democrat party veering hard left with Bernie, now it looks more like Norman Thomas Socialist Party.
Chuck and Nancy will encounter resistance from their base trying to deal with Trump. But Trump will use them to attempt to leverage the Republicans to do something. But with just enough Mavericks in the Senate and the problematic Freedom Caucus, I don't se the Republicans getting much done.
As the CNBC writer suggest, George Washington opposed political parties. The Constitution does not mention them. Jefferson and Hamilton were for them. We are seeing a re alignment that goes back to the Democrat Party founded in 1828.
Similarly the Republican Party founded in 1854.
is simply foundering. It has done well at the State level gaining state houses and governor ships. But at the national level it lacks the cohesive vote power of the Democrats. And between Hillary and Obama, there is simply no younger Democrats seeming move up to leadership positions.
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It cost UC Berkeley $600,00 to deal with protestors at Shapiro speech.
Finally even the liberal President of UCB is showing a bit of backbone. So far the markets have shrugged off riots here and repeated terrorist attacks in Europe.
Markets
Energy Bullish Percent
The arrows indicate the major lows every three years in the energy complex. We are just coming off the latest three year low. This is the reason for my turning so optimistic in my newspaper column this week. At top the histogram is approaching zero and the MACD is flattening out.
XLE Energy
I like everything about this chart. Energy has been out of favor since 2014. The big correction ended in February 2016. We now either have an A up and B down or the start of a five wave pattern. Either way PMO is flattening at t higher level. I suspect XOP at top which is another Energy ETF offers a better percentage return.
XES Energy Service
I like this set up even more. XES is just now making a big double bottom at the February 2016 low. Patterson PTEN is a major player in Texas in the worker rig category. It is an excellent proxy for that industry. It too looks to be bottoming at the February 2016 low. freak
FRAK Shale Producers
FRAK is making a higher low than February 2016. I used Abraxas AXAS at top. It is one of many small energy companies in the Eagle Ford and North Dakota.
Chesapeake CHK
Everything that could go wrong for a company went wrong for CHK, too much debt, and then the CEO finally died in a one car crash into a freeway abutment. But again this is nice set-up.
Transocean RIG
One of RIG's competitors, Seadrill, is now in bankruptcy court filing Chapter 11. But again, yes there is a lot of supply but there is also a lot of demand.
RIG Daily
The blue downtrend line has been broken. PMO is turning up at bottom.
RIG Short Term
Percentage wise this is a huge move and we are at the last resistance level already. It might re try the 50 day MA if there is resistance at the 125 day line just above.
Natural gas is breaking out as well.
Iron Ore CLF
CLF is pulling back to its uptrend line. This is another commodity play that longer term offers huge possibilities.
CLF Long Term
What's not to like? the MAs are converging which happens before change in trend. PMO is flattening at bottom. At top RSI is much stronger than a year ago.
US Dollar, Australian Dollar
The US Dollar has been in free fall this year. It looks like it will make a stand at its 200 week moving average. This could halt the advance of oil and commodities in general. The move up in commodity prices has lifted the Aussie Dollar at top.
Gold Miners Bullish Percent
As with energy the bullish percent of gold miners is moving up and in fact is at about the same level as energy. The long downtrend is being broken.
Tom McClellan thnks gold has one more dip before the rally get going
Silver Miners
Coeur D Alene CDE in black, left scale, Hecla HL in red right scale. PMO at bottom suggests a low is near but we again ned to watch the US Dollar for a rebound.
Bottom Line
We like the beaten down energy and energy service sectors. Gold and silver may have a bit more wait as the dollar could easily re bound.
Stocks have shrugged off all sorts of bad news and seem to remain firm.
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