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13Dec2016 Market Update: DOW Almost There, New High Water Marks Made Again Today, Crude Prices Climb, US Dollar Steady, Gold Remains Weak

Written by Gary

U.S. stocks reached all-time highs today (SPY +0.8%), with the Dow Jones industrial average less than 70 points away from the 20,000 mark, as a record-setting post-election rally showed no signs of fatigue. Short-term indicators showing a very strained market.


Here is the current market situation from CNN Money

North and South American markets are mixed. The S&P 500 is higher by 0.87%, while the IPC is leading the Bovespa lower. They are down 0.12% and 0.03% respectively.

Traders Corner - Health of the Market

Index Description Current Value
Investors.com Members Sentiment: % Bullish (the balance is Bearish) 78%
CNN's Fear & Greed Index Above 50 = greed, below 50 = fear

88%

Investors Intelligence sets the breath Above 50 bullish 66%
StockChart.com Overbought / Oversold Index ($NYMO) anything below -30 / -40 is a concern of going deeper. Oversold conditions on the NYSE McClellan Oscillator usually bounce back at anything over -50 and reverse after reaching +40 oversold. +27.72
StockChart.com NYSE % of stocks above 200 DMA Index ($OEXA200R) $NYA200R chart below is the percentage of stocks above the 200 DMA and is always a good statistic to follow. It can depict a trend of declining equities which is always troubling, especially when it drops below 60% - 55%. Following a major market correction, the conditions for safe re-entry are when:
a) Daily $OEXA200R rises above 65%
Secondary Bullish Indicators:
a) RSI is POSITIVE (above 50)
b) Slow STO is POSITIVE (black line above red line)
c) MACD is POSITIVE (black line above red line)
77%
StockChart.com NYSE Bullish Percent Index ($BPNYA) Next stop down is ~57, then ~44, below that is where we will most likely see the markets crash. 71%
StockChart.com S&P 500 Bullish Percent Index ($BPSPX) In support zone and rising. ~62, ~57, ~45 at which the markets are in a full-blown correction. 71%
StockChart.com 10 Year Treasury Note Yield Index ($TNX) ten year note index value 24.88
StockChart.com Consumer Discretionary ETF (XLY) As long as the consumer discretionary holds above [66.88], all things being equal, it is a good sign for stocks and the U.S. economy 84.53
StockChart.com NYSE Composite (Liquidity) Index ($NYA) Markets move inverse to institutional selling and this NYA Index is followed by Institutional Investors

11,228

What Is Moving the Markets

Here are the headlines moving the markets.

Wall St. extends record rally, Dow closes in on 20,000

(Reuters) - U.S. stocks reached all-time highs on Tuesday, with the Dow Jones industrial average less than 100 points away from the 20,000 mark, as a record-setting post-election rally showed no signs of fatigue.

Trump's tough trade talk makes U.S. firms fear China retribution

CHICAGO/WASHINGTON (Reuters) - U.S. President-elect Donald Trump's challenges to China on trade and Taiwan are rattling American companies who have long benefited from stable relations between the two countries but now fear retaliation by Beijing if Trump were to act.

British pension funds warn on any Fox/Sky deal

LONDON (Reuters) - British public sector pension funds on Tuesday called for an "appropriate" premium in any potential deal between Twenty-First Century Fox and Sky as well as for safeguards to protect minority shareholders.

Slack management exposed BP to high safety risk: leaked report

LONDON (Reuters) - BP's refining operations are exposed to high safety risks that can lead to deadly accidents and pollution as a result of slack management and a lack of investment, according to a leaked internal report from 2015.

After Alaska flop, Shell's search for oil moves closer to home

LONDON (Reuters) - In the waters off Malaysia, Royal Dutch Shell is finding gas quickly and cheaply to replenish depleting fields where only a few years ago geologists had lost hope of discovering any new reserves.

GM delivers its first Bolt electric car in Tesla's backyard

(Reuters) - General Motors Co on Tuesday said it delivered its first Chevrolet Bolt electric car to a family in Fremont, California, home to rival electric automaker Tesla Motors Inc's assembly plant.

Meet Waymo, Google's self-driving car company

SAN FRANCISCO (Reuters) - Alphabet Inc's Google self-driving car project will become an independent entity within the technology company called Waymo, executives said on Tuesday, signaling a willingness to finally monetize its valuable research amid fierce competition from rivals.

Apple AirPod headphones available for sale after two-month delay

(Reuters) - Apple Inc said on Tuesday its wireless AirPod headphones were now available through its website, two months after the company delayed their launch for unexplained reasons.

UniCredit to raise 13 billion euros in Italy's biggest share issue

MILAN/LONDON (Reuters) - Italy's largest bank, UniCredit , plans to raise 13 billion euros ($13.8 billion) in the country's biggest-ever share issue to shore up its balance sheet and shield itself from a broader banking crisis.

Despite Post-Election Spike In Optimism, Small Business Owners Have Never Been More 'Uncertain'

Small Business Optimism was "basically unchanged from October's reading up to the point of the election and then rose dramatically after the results of the election were known," according to NFIB chief economist Bill Dunkelberg. In fact the surge was the sharpest since 2009 as the balance of those who thought business conditions would improve exploded from -6 to +38. However, actual sales continue to decline and "business uncertainty" has never been higher.

As Bloomberg reports, "Small businesses like unified Republican government," said Neil Dutta, head of U.S. economics at Renaissance Macro Research LLC, who highlighted that the NFIB's index fell in November 2012 — when Obama won re-election — but recorded a solid rise in November 2004 after voters granted George W. Bush a second term.

However, the vast majority of segments that showed improvements in November's survey were forward-looking in nature; on both actual sales and earnings changes, the balance of opinion remained steeply negative.

As optimism soars, actual employment declined...

And as actual sales tumble, so hope for future sales soars...

< ...

Trader Sees "Reckless Amount Of Confidence", Warns 'Watch China'

We realize that it's the holiday season and markets are thin, but they sure are interesting. Full of complexities. Or is it contradictions? As Bloomberg's Richard Breslow notes, so many assets, economic story lines and geopolitical risks can go either way. Yet traders seem to be set on their current leaps of faith and happy to ignore the rest as next year's problem.

Despite all the debatable points there's a remarkable, some would argue reckless, amount of confidence being espoused. People are sure that things are setting up quite clearly for us to be about to enter the year of the [fill in the blank]. How we close this year will have a lot of influence on market psychology as positions are rebuilt and P/Ls started anew come January.

One favorite, no surprise, is the dollar is the place to be. Rates, safe haven, fiscal stimulus. USD/JPY is motoring and EUR/USD will have to test lower. Yet the minds of traders work in mysterious ways.

Monday we made a multi-month high in USD/JPY and then had a sloppy close. Failure came the screams. Mostly from people who don't have the trade. A month of fundamental analysis went out the window. Until the pair re-took 115 Tuesday. Sloppy closes should be a chapter heading when they write the history of this year and are not as informative as they were in the past.

For now, the dollar index is between 100.50 and 102. Trade away in-between. Declaim outside.

Chinese Newspaper General Manager Mysteriously Falls To His Death

While the US has been bombarded by the artificial, mainstream media-fabricated concept of "fake news" for the past month, a strawman erected in an attempt to impose creeping limits on free speech and eliminate any outlet that does not comply with the government narrative and is accused of being "Russian propaganda", China does not need to beat around the bush. Instead, it has shortcuts, like newspaper editors unexpectedly "falling" to their death.

Case in point: Liu Jiandong, the general manager the 21st Century Business Herald, a major Chinese newspaper group that has been in trouble with the government for alleged blackmail and corruption, mysteriously "fell to his death on Monday", the newspaper said.

The 21st Century Business Herald carried a short statement on its official microblog from publisher 21st Century Media Ltd saying 21st Century Media's general manager, Liu Jiandong, had fallen from a building and died despite efforts to save him. As Reuters adds, Liu took up his job in January 2015, which he was dedicated to, and was "upright and honest", the paper said, adding an investigation was going on.

In a "suicide" that was a carbon copy of the death of Monte Paschi's David Rossi, the police in the southern city of Guangzhou, where the newspaper is based, said it had responded to a call about a man "falling from an office building." Police only identified him by his family name, Liu, and said he was a company general manager.

They added that "at the moment" there was no suspicion of murder. They will certainly have no suspicion of murder if their investigation reveals that the Chinese government itself is involved in the "suicide."

Why was the newspaper on China's black list? As the WSJ report ...

Deutsche Bank "Explains" How Stocks Will React To The Fed's Rate Hike

"This time is different", or maybe it's just 1929 all over again, because according to Deutsche Bank, after 8 years of easing sent the S&P to all time highs, the only thing that is more bullish than a dovish Fed, is a Hawkish one, and as a result no matter what the Fed does tomorrow, and how it hikes rates, equities can only go "higher."

Investors Get Ready for the Coming Electric Car Revolution

Battery-powered electric cars outsold gasoline ones at the dawn of the automotive age. In a decade or so they may well do so again. Investors need to watch out they don't get caught on the wrong side of history.

Did VeriFone Hit Bottom in 2016​?​

Credit-card reader VeriFone was slammed by delays in chip readers and Chinese competition. The worst may be over. ​

Techs & Trump: Nowhere to Go But Up

The market has penalized tech companies since the election, which sets the bar low for a high-profile summit between Trump and the nation's top tech executives.

Key Words: Bill Gates: Donald Trump is like JFK

A MarketWatch reader recently took to the comments section to hail Donald Trump as "the 21st Century's Abe Lincoln." Microsoft's Bill Gates has now offered a flattering presidential parallel of his own.

The Wall Street Journal: Alphabet is spinning out its driverless car company into new unit called Waymo

Google parent Alphabet Inc. is spinning out its driverless-car technology from a research lab into its own business unit, called Waymo, that soon will be expected to start earning revenue.

How to live out your childhood dreams during retirement

Did you become what you wanted to be when you grew up? There's still time to do it in retirement.

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To contact me with questions, comments or constructive criticism is always encouraged and appreciated:

gary@econintersect.com

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