- Ah, gentlemen, you know why we are here We've not much time, and quite a problem here. ...We need a more permanent solution to our problem...
- Andrew L. Webber
Market Outlook
In His honor, we submit the rock opera. Time changes, humans don't. The Bulls seek to regain control of the market. They want to capitalize on the dangers to the banking system to which could stop the Fed. The long awaited "pivot" is at hand, according to them. They also seized the date. We are in "window dressing" time and the end of the month. They do have some positives that could sway your thinking. We say, "No!" However, the decision is always yours to make. Let us look at the picture...
The Dow ended the market in a strong rally. With a short week due to Easter, they will seek to keep the market rising. We say that the real conviction will show itself if the Dow can pierce the 34,000 range. Keep in mind, that the month of March saw another new low and the volume is the strongest on down days.
The transports also rose. This is a strong sign for harmony in the market. However, the transports also hit a new low in March with heavy volume. Its test will be 15,000?
The SPX followed the two leaders in the New York exchange. Its real strength will be revealed if it can pierce 4300?
Nasdaq is the leader in the uptrend. It too has a test in its sight. It needs to surpass 13,000.
IWM, the smallcap is still the weakest link. Its firms are the hardest hit by the Fed's policies.
With all of the above, there are a few fundamentals to the charts. Have you looked at a new electric truck? Ford lists its F-150 at $61,000. Ouch! It is the same for all the carmakers. We already know that the biggest consumer expense, housing, has prices over half of our nation cannot meet. Can the other half afford a new car with the already high house costs? This does not bold well for the economy that is under inflation stress and the Fed placing higher interest rates to their budget.
At present, oil is bouncing. Where it goes is anyone's guess. As soon as you catch your breath with the sentence, OPEC and Russia agree on an oil cut. However, even with the uptick, it is still in consolidation range. It would have to pass $82.62 to show conviction. One reason why all the previous worries about supply did not come to pass was a simple aspect that Russia did not sell to the West, but China took all the supply. The West did not have the Chinese to compete as buyers. Enough supply to go around. With the late winter, we will have to wait for a clear signal as to where the oil price is going.
Meanwhile...
The present uptrend in the market could be traced to the falling dollar. Like we have said many times, the market moves opposite to the dollar. Now, the retracing dollar is giving the market breathing room. Keep in the back of your mind, dynamics can change as other factors come into play. We noticed one big disturbing bit of news. The BRICS alliance is calling for their members to put forth a new common currency for them to trade. We see this as a positive when you view the consequences of such a move. China has always wanted this as "...a more permanent solution to our problem..." We see it resulting in greed, anger, jealousy, disappointment and the second step in ending the Russia/China pact.
- No riots, no army, no fighting, no slogans... One thing I'll say -- Jesus is cool. Thank you, Andrew for Jesus Christ Superstar. Happy Easter! Peace.
