Written by Gary
US markets are ‘channeling’ trading between a minor support and and a major resistance on low, but moderate volume. Some analysts are seeing this as a consolidation before moving up. WTI crude failed again to move past its resistance at $38.20, now viewed as a significant stumbling block most likely supported by shorts. A late afternoon rally could take the Spooz up to 1994.
Here is the current market situation from CNN Money | |
 | North and South American markets are mixed. The S&P 500 is higher by 0.32%, while the IPC is leading the Bovespa lower. They are down 0.46% and 0.17% respectively. |
Traders Corner – Health of the Market
| Index | Description | Current Value |
| Investors.com Members Sentiment: | % Bullish (the balance is Bearish) | 71% |
| CNN’s Fear & Greed Index | Above 50 = greed, below 50 = fear | 72% |
| Investors Intelligence sets the breath | Above 50 bullish | 53.8% |
| StockChart.com Overbought / Oversold Index ($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. | 61.39 |
| StockChart.com NYSE % of stocks above 200 DMA Index ($NYA200R) | $NYA200R chart below is the percentage of stocks above the 200 DMA and is always a good statistic to follow. It can depict a trend of declining equities which is always troubling, especially when it drops below 60% – 55%. Dropping below 40%-35% signals serious continuing weakness and falling averages. | 36.57% |
| StockChart.com NYSE Bullish Percent Index ($BPNYA) | Next stop down is ~57, then ~44, below that is where we will most likely see the markets crash. | 57.51% |
| StockChart.com S&P 500 Bullish Percent Index ($BPSPX) | In support zone and rising. ~62, ~57, ~45 at which the markets are in a full-blown correction. | 71.20% |
| StockChart.com 10 Year Treasury Note Yield Index ($TNX) | ten year note index value | 18.83 |
| 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 | 75.74 |
| StockChart.com NYSE Composite (Liquidity) Index ($NYA) | Markets move inverse to institutional selling and this NYA Index is followed by Institutional Investors | 9,910 |
What Is Moving the Markets
| Here are the headlines moving the markets. | |
| Chesapeake mulls sale of assets in Oklahoma shale field: Bloomberg (Reuters) – Chesapeake Energy Corp is considering selling some of its assets in Oklahoma’s Stack shale field, Bloomberg reported. |
| Societe Generale says to cut 550 jobs over five years PARIS (Reuters) – French bank Societe Generale said on Wednesday it would shed 550 jobs over five years as part of consolidation of its 20 French client treatment centers into 15 sites. |
| Qatar Air says Pratt & Whitney engines not adequately tested BERLIN (Reuters) – Qatar Airways stepped up its criticism of U.S. engine maker Pratt & Whitney over delays and technical problems on Wednesday, saying that engines for its Airbus A320neo aircraft had not been adequately tested. |
| Chipotle’s shares drop after latest food safety incident (Reuters) – Shares of Chipotle Mexican Grill Inc fell more than 6 percent in morning trading on Wednesday, a day after the popular burrito chain operator said it would temporarily shut a Massachusetts restaurant after four employees fell sick. |
| Crude oil recovery drives Wall Street higher (Reuters) – Wall Street was higher on Wednesday as a strong recovery in oil prices boosted energy shares. |
| Forget fracking. Choking and lifting are latest efforts to stem U.S. shale bust (Reuters) – Something is awry in the beleaguered U.S. shale patch: older wells, which normally gush oil or natural gas in their first few months before rapidly depleting, are not petering out as quickly as they should. |
| U.S. wholesale stocks rise, seen hurting growth in 2016 WASHINGTON (Reuters) – U.S. wholesale inventories unexpectedly rose in January as sales tumbled, suggesting that efforts by businesses to reduce an inventory overhang could persist well into 2016 and restrain economic growth in the coming quarters. |
| Signs of life for Apple’s stock as Wall St. eyes new iPhone SAN FRANCISCO (Reuters) – After months of declines in Apple’s stock, sentiment appears to be mending as investors focus on steady earnings expectations and bet that the expected launch of a new iPhone will add badly-needed fuel to sputtering sales. |
| Amazon to lease planes for delivery (Reuters) – Amazon.com Inc will lease 20 Boeing 767 freighter aircraft, lessor Air Transport Services Group Inc said on Wednesday, as the online retailer moves closer to setting up its own air delivery network. |
| Famed Short Seller Muddy Waters Says It’s Just A “Dead Cat Bounce”Echoing the less than exuberant credit market and confirming Jeff Gundlach’s (and former Fed President Dick Fisher), infamous short-seller Muddy Waters’ Carson Block told Reuters that the recent rally in the U.S. stock market feels like a “dead cat bounce.”
It seems the market was listening…
Will 1980 hold up again? |
| Chevron Protects Dividend, Slashes Another 36% Off SpendingSubmitted by Nick Cuningham via OilPrice.com, The largest oil companies are struggling to balance competing objectives with dramatically lower revenues compared to previous years. Nearly all have taken the axe to their spending levels, although to varying degrees. New exploration projects have been scrapped, suppliers have been squeezed, and workers have been laid off. But the top tier companies are fighting to protect their dividend policies above all else, an increasingly expensive priority that is forcing deeper cuts to spending. But the strategies differ depending on the company. Chevron, for example, continues to cut spending in order to keep its dividend. The California-based multinational just announced that it would cut its capex in 2017 and 2018 by another 36 percent, bringing annual spending down to between $17 and $22 billion. That is down from an October 2015 estimate, when Chevron said that it expected to spend $20 to $24 billion each year in 2017 and 2018. It is also sharply lower than the $26.6 billion Chevron is spending this year, which itself is a 25 percent reduction from last year’s levels. The severe cuts come as Chevron has had to take on debt in order to afford shareholder dividends, as the company has not generated enough cash flow to cover the payouts with oil prices as low as they are. Dividends cost the company $8 billion in 2015 alone. Chevron would need oil trading at $50 in order to cover the dividend with cash flow. This week is also notable for Chevron because the giant Gorgon LNG project in Australia is finally beginning operations. The $54 billion export facility has absorbed … |
| Former Fed President: “We Injected Cocaine And Heroin Into The System To Create A Wealth Effect”Just two months ago, former Fed President Dick Fisher admitted that “The Fed front-loaded an enormous market rally in order to create a wealth effect.” Today he is back, taking a victory lap onthe 7th anniversary of the crisis lows by explaining, rather stunningly, to CNBC that “we injected cocaine and heroin into the system” to enable a wealth effect (that he admits did not work, despite its success in raising asset prices), and “now we are maintaining it with ritalin.” Fisher also confirmed his previous warning that “The Fed is a giant weapon that has no ammunition left.” Fisher explains how The Fed achieved its goals… but admits that didn’t really fix anything… And here is CNBC’s higher quality (edited) version where the blame for everything is pinned on “feckless fiscal authorities…” Once again, Fisher appears to be undertaking a major “cover-your-ass” episosde, proclaiming that he was against QE3 which is what has forced “valuations to be very richly priced.” |
| Dow Makes Another Run at 17000U.S. stocks rebounded Wednesday, but gains were muted as investors awaited in the coming days comments from the European Central Bank and the Federal Reserve. |
| Bull Market Turns Seven: Few Saw It ComingA bull market in U.S. stocks that has been doubted by many analysts since its first day currently ranks as the third-longest in history. |
| Oil Rallies on Higher Demand for Gas, Diesel FuelOil prices added to gains Wednesday after new government data showed demand for gasoline and diesel fuel was far higher than already-bullish expectations. |
| January 2016 Wholesale Sales Weakness GrowsWritten by Steven Hansen The headlines say wholesale sales were down month-over-month with inventory levels remaining at levels associated with recessions. Our analysis shows a declining trend of the 3 month averages. The best way to look at this series may be the unadjusted data three month rolling averages.
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| London Markets: FTSE 100 trudges higher in the countdown to ECB meetingU.K. blue-chip stocks rise, with investors looking ahead to a European Central Bank meeting that could result in additional economic stimulus for the U.K.’s largest trading partner. |
| Metals Stocks: Gold futures head for a 3rd session loss in a rowGold futures headed for a third straight session loss Wednesday as strength in oil prices and the U.S. stock market dulled the metal’s investment appeal. |
| New index will track Apple, GoPro and others in wearable tech spaceEQM Indexes launched a new index that will track companies in the market of wearable technology |
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