- What goes up must come down.
- Law of Gravity
Market Movement
The price action says loud and clear that our market call of a large retracement is wrong. There are many reasons that we believe it is correct, but the charts do not lie. However, they can deceive?
Anyway, the Industrials hit a new all-time record at 43,325. The volume was okay. The SPX also broke a new record at 5872. Finally, in true Dow Theory, the Transports joined the rally. This constitutes a bull market. The only point that keeps our conviction is the transports did not hold price. When you cannot hold price, you have to look at other indicators. We did.
Big Boys
Apple (AAPL) is hanging around its highs. This is a big plus for the bulls. Microsoft (MSFT) could not hold price. It fell back into its consolidation range. Question mark? Google (GOOG) also could not hold price. It too fell back into its consolidation range. Question mark? Facebook (META) is at its highs. Another plus for the bulls. We continue looking...
Semi's
The chips always lead the charge up and conversely, down. They have been acting weird. They hit new highs and then, fell hard. Then, they rallied hard. We look at a few.
Intel (INTL) Fell hard on poor earnings and outlook. Rallied hard, but fell back into consolidation. Nvidia (NVDA) Was at $140 in June. It fell to $95 and now has rallied back to its highs. ASML Holdings (ASML) It reached $1100 in July only to fall to $675. Last Friday was at $723. Advanced Micro (AMD) It was over $225 in February and fell back into consolidation at $155.
So, the semi's are mixed, but indicate more downside than upside. Next...
Commodities
The most important is falling sharply. This is happening while the Middle East is spiraling in war. This is happening at the same time the market indexes are hitting new all-time highs. Brent fell to $69 last Friday and US crude hit $68. Low resistance for American oil is $65. This needs to be watched closely. The best indicator for commodity pricing is King $Dollar. It has rallied hard from low resistance. It pierced the upper resistance at 103.5. However, it failed to hold price. If it attacks the upper level of resistance and holds price, commodities should fall. However, there are other aspects to each segment within the sector. We had a great week in...
Precious Metals. Gold hit a new record and silver joined the party. Last Friday, the old coins rose $2.15 to $33.23. This relates to the BRICS and their fight against the dollar. It also points to the Fed and their cutting of interest rates which could also hurt the dollar. Like I say in my unpublished book, "All things are connected."
Other Points...
in commodities is lithium. Bloomberg reports that 10% of all car miles is from electric power. Lithium and copper are the two chief needs in electric power. Doctor Copper fell from its record high, but it is in its upper consolidation range. You can see that through Freeport-McMoRan and Taseko Mining. The two are in their upper consolidation range. However, lithium stocks reflect a deep fall in price. The leader is Albemarle. This material giant was $155 last December and fell hard to $75. Last Friday it was $95. Lithium American Corp (LAC) rose to $7.50. It has a great mining location in Argentina. However, it fell to $4.50 and last Friday was at $3.14. The two lithium stocks say demand is falling. This is a market tell in our book. Finally, we look at the present state. We see...
Strikes, Layoffs and Store Closings
The striking leader is Boeing. The company might get an agreement. The union votes Wednesday. The big point is a pay hike from 25% to now, 35%. These workers make on average $75K per year. This is a good paying job. but Seattle is very expensive. However, most of us do not even make the $75K? What does this say about our economy? Meanwhile, three large drug chains are showing collapse. Walgreens is closing 1200 stores. CVS has closed 1300 in the last two years and Rite Aid is in bankruptcy. Consider all the workers who will lose their job? Consider the supply chains that will layoff workers because their main customer is dropping demand? Consider the lie from the BLS about unemployment? We still say that our economy is in stagflation and that is not good. We stand by our call. Peace.
