About Me

Retired chief investment officer and former NYSE firm partner with 50 plus years experience in field as analyst / economist, portfolio manager / trader, and CIO who has superb track record with multi $billion equities and fixed income portfolios. Advanced degrees, CFA. Having done much professional writing as a young guy, I now have a cryptic style. 40 years down on and around The Street confirms: CAVEAT EMPTOR IN SPADES !!!

Sunday, January 15, 2017

Market Psychology & SPX Weekly

Market Psychology
Following the strong post-election rally, the market has lapsed into a 2260 - 2280 range on the SPX
since mid-Dec. Toward the end of last week, Bloomberg featured quips from US dollar traders that
suggested: "Where is my stimulus?" or emerging impatience as the lead-in to inauguration day
wears on. So far, The Donald has offered growth negatives such as the idea that drug prices be
subject to haggling and the hit on Lockheed for padded costs. Meanwhile, the Congress is fast
tracking repeal of the ACA -- a negative for health care business volumes. There is a contretemps
with China over the status of Taiwan and a crackling good dumpster fire involving Russia's hack
of the DNC and subsequent developments. Get used to it. The stimulus programs will be announced
in due time, but we're talking Trump here and you have to take the goodies along with all the other
horseshit and troubles that will inevitably come. So, markets players patience is being tested and
all will have to wade through the Trump crap. And then there is the Fed who may have to face
programs that ultimately raise inflation potential.

SPX Weekly
The SPX continues its bull run from 3/2009. It is now nearing a moderate overbought against its
13 and 40 wk. moving averages, and is moving into overbought territory on RSI and MACD. There
is room to run on the upside, but such will involve investors relaxing more of the caution they have
displayed since the end of 2014 when the Fed ended the QE programs. Near term business
fundamentals will continue to weigh heavily on the action and players who are counting styrongly on
a new pro-business environment to produce more positive market action will have to keep spirits
up.   SPX Weekly

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