Monday, August 27, 2012

The Morning Call--Monday Morning Chartology + Clarity on Merkel


The Market
Technical

Monday Morning Chartology


The S&P is solidly within a very short term uptrend (black line) and after Friday’s strong up day, looks poised to challenge 1422 again.






Last week, GLD busted through (1) the level of the last lower high [orange line], (2) the short term downtrend [brown line] and (3) its 200 day moving average [wiggly red line]. All in all, a pretty impressive surge; and the reason our Portfolios Added to their GLD positions.




As you can see, I have resolved my frustration with the VIX technical performance by adjusting downward the lower boundary of the VIX intermediate term trading range (purple line). It still working on that head and shoulders formation, but can’t bring it to fruition.




Election year volatility (short):
http://www.zerohedge.com/news/guest-post-why-you-always-want-physical-everything

Fundamental

Great article on the market’s ‘discounting mechanism’ (medium):
http://www.zerohedge.com/news/guest-post-trading-yesterdays-news-%E2%80%93-what-does-stock-market-really-know

Cash is king (short):
http://www.zerohedge.com/news/guest-post-why-you-always-want-physical-everything

Getting clarity on Merkel (medium):
http://www.zerohedge.com/news/vacation-over-europe-back-square-minus-one-merkel-backs-weidmann-demands-federalist-state

The ECRI index rose again last week (short):
http://advisorperspectives.com/dshort/updates/ECRI-Weekly-Leading-Index.php

***over the weekend, China reported lower corporate profits for the fourth month in a row



Steve Cook received his education in investments from Harvard, where he earned an MBA, New York University, where he did post graduate work in economics and financial analysis and the CFA Institute, where he earned the Chartered Financial Analysts designation in 1973. His 40 years of investment experience includes institutional portfolio management at Scudder, Stevens and Clark and Bear Stearns. Steve's goal at Strategic Stock Investments is to help other investors build wealth and benefit from the investing lessons he learned the hard way.