Friday, October 21, 2016

Weakness Getting Bought Up

It’s Not Enough

By -

Damn this market. Every time we see a little bit of weakness, it’s still getting bought up. This morning, we opened down over 12 points. As I type this, it’s pushing against the selling, having trimmed its loss down to merely 8. It’s getting quite exasperating, because we need to cut through the entire “drop zone” I’ve tinted in green below to reach the promised land (which is looking not-particularly-promised), shown with the support line.
On a wholly different topic, you Twitter users out there might want to check out the trending hashtag #TrumpBookReports, which are tweets about books written in Trump prose.

More Evidence Of The Seriousness Of Bad Loans Mounting In China

Minsheng 'may establish bad-loan asset company'

Slowing economy is resulting in growth in volume of NPLs China Minsheng Banking Corp is studying plans to set up an bad-loan asset management company, as the Chinese lender seeks ways to rid itself of some of its $5.7 billion of non-performing loans (NPLs), people with knowledge of the matter said. Minsheng Bank is seeking guidance…

Bullish Engulfing Pattern In Biotechnology (XBI)

I actually put this arrow in last night on the Biotechnology ETF XBI but things are looking overextended and some of my shorter-term indicators were bullishly aligning. The other reason I thought things were going to take a turn upwards was because of how perfectly it stopped at a long term support line just below $59.00. In addition to all this there is divergence on the RSI(5) with a lower high being put in. Please be aware of the fact that this is no way presaging some grand resurgence in biotechnology as the overall trend seems to be down but it does seem like this is a bounce that people could take advantage of.

Inflation Doesn't Always Help Your Export Market

Manufacturers fail to profit from weak yuan

Chinese machinery manufacturers have found it difficult to profit from the recent depreciation of the renminbi in the short term, company executives said. Exhibitors from the machinery sector at the 120th Canton Fair in Guangzhou, Guangdong province, said the yuan depreciation, to its lowest level in six years against the dollar, had limited effect in boosting…

Well This Must Be A Little Awkward For The IMF

US official pushes for IMF reform, praises AIIB

A senior US Treasury official expects the International Monetary Fund (IMF) to have a chief from outside Europe in the not near future. Nathan Sheets, the US undersecretary of treasury for international affairs, was talking about IMF reform on Tuesday when he was asked if IMF managing director would come from emerging economies such as China…

Draghi Stands Pat

European Central Bank leaves stimulus measures unchanged

There were no new stimulus measures announced by the European Central Bank on Thursday. At their latest meeting ECB policymakers kept interest rates unchanged and deep in negative territory. ECB President Mario Draghi and his colleagues also said the bond buying programme to pump money into the eurozone economy will continue at the same level –…

Thursday, October 20, 2016

Really, Theresa? Really?!?!

The price of Brexit is going up, whether Theresa May likes it or not

When Theresa May, the fill-in U.K. prime minister, earlier this month came out hard against immigration and for British sovereignty in any new deal with the European Union, the reaction provided a glaring example of the widening disconnect between populist politics and economic "common sense." In her Oct. 2 address to the Conservative conference, May promised…

Energy (XLE) Showing New Upward Channel

We recently called the ascending wedge in Energy ETF XLE a few days ago absolutely perfectly and support was found like clockwork at the EMA(34). Now an upward channel is developing in XLE, albeit a rather narrow one. Overhead resistance is at around $72.50 and if that were to be breached a further strong thrust should be expected. The alignment of the EMA's right now could not be more perfect with the EMA(9) and EMA(13) both directing upwards. The OPEC agreement is a little wobbly but energy prices have rallied impressively since.

Everyone Loses With Protectionism

Philip Cross: It's Canada vs. the protectionists in the new world trade wars

As a trading nation, Canada has much to lose if protectionism - clearly on the rise in the U.S. and Europe - gains more ground. Protectionist sentiment reflects a misunderstanding of how trade benefits the economy. The benefit does not come from a mercantilist maximizing of the surplus of exports over imports. Treating exports as good…

Short Term Thinking Returns To Oil Industry

Peter Tertazkian: With US$60 the new US$90 for oil, long term projects are no longer fashionable

I don't know much about fashion, but I have heard that blue is the new black. And I know that by the time I buy blue, everyone else will be wearing green. In the oil business, modish pundits are now pronouncing, "60 is the new 90," championing the thesis that productivity gains, cost improvements and price…

Wednesday, October 19, 2016

Treasuries Have Been Taking A Beating Lately

Bond Rally Forthcoming?

By -

If there’s one clear downtrend out there (which has been in place for – what – decades now?) it’s interest rates, in spite of all the blather about “normalization” (news flash: it ain’t gonna happen, folks). Here’s the $TNX, with the persistent series of lower highs marked:
Thus, I suspect another bond rally may be forthcoming, since prices have eased all the way back to what I consider a fairly strong zone of support.


Just To Re-Hash The Move In Gold Miners (GDX), But I Did Call This A Week Ago

I have re-posted the article by Tim Knight from Slope of Hope, but in fairness to my permanently shattered ego I did post this exact scenario a week ago (it's just very nice someone agrees with me). Anyway, the divergence on the RSI(5) is complete and there is a gap to fill between $25.00 and $25.50. I've drawn in some interesting overhead resistance areas to keep an eye on, but you can precariously play this as an intermittent long/buy before converting to a short/sell somewhere are around $25.60.

Oil: Still The Biggest Elephant In The Room

Courtesy of: Visual Capitalist

Good Thing I'm Not The Only One Worried About The Crazy P/E Ratio's Going Around

Value disconnect has this fund manager treading cautiously

Value investors are always cautious, and in many cases, they are looking for change. Without that change, a stock will likely remain cheap and become a value trap. Given that most central banks around the world have kept interest rates at or near zero, money that would normally be in the fixed income market has fled…