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April 14, 2018

Posted by Tom in Thoughts.
Tags: , ,

April 13, 2018 – It was Friday the Thirteenth and just about everything was happening.  Political issues, trade issues and international saber rattling.  It will be interesting to see how the markets react on Monday (hint: watch the Asian markets on Sunday night).  But I really don’t think this market cares much about them right now, for next week the focus will be on earnings.  Yes, earnings are expected to be very good (how could they not with a big gift of a tax cut); but the interest will be on “forward guidance”.  The corporate equivalent of predicting what earnings will be next quarter.

So far we’ve hit the “spring” level and bounced off; just as a spring action should show.  We need to have a Show of Strength (SOW) with a nice wide boded bar on high volume closing above 7205, or better yet, above 7332 on the NASDAQ.  Indicators are mixed, but what concerns me is the low volume of last week.  This looks like a cautious wait and see stance.  It shouldn’t last very long though.

While “Price Strength” is modestly bullish, I’m working on a refinement of that indicator.  While not ready for “prime time”, it does indicate a bullish environment, but not that last final trigger.  That trigger is based off of “Volume Spread Analysis” (for those of you who are interested).  I’m kind of excited about it since it appears to be robust and fast reacting to market changes.

Here’s what’s happening on the sector front in the short term:

I’ve taken modest positions in Energy, Precious Metals and European sectors.  I will add to these next week IF the market shows some follow through.  I’ve also taken off my bear fund, which I held as a hedge.  Right now cash looks OK to me as I can go either way as needed.  There’s still a lot of unknown and volatility out there.

That’s it for this week.  Have a good week.      ……….  Tom  ………

Price chart by MetaStock; pie chart & table by http://www.HighGrowthStock.com. Used with permission.


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