I Want to Take You Higher

September 3, 2018

Weekly Market Outlook

By Keith Schneider

blankUS Equities hit new all-time highs as the trade war with Mexico appears to be a head fake.  August performance for the NASDQ 100 (QQQ) was up over 5%.

September is usually seasonally weak, but we just had some very positive economic news and the odds are now higher that this year could be an anomaly.

The unemployment rate hit 3.9%, its lowest numbers since Woodstock (that was August 1969) This is very positive news for the longer-term picture as recessions don’t start until at least 6 -7 months after a rise in the unemployment number.

Last week we mentioned that Israel was the leading stock index looking out over the past 3 to 6 months which continued that trajectory this week, up almost 2%. The Index has also broken out of a multi- year congestion pattern.

The recent indictment of the Prime Minister’s (Bibi Netanyahu) wife, along with other looming legal issues for Bibi, has not fazed the Israeli stock market. This is a good take away and market trading lesson- pay attention to the market action, especially when it discounts the news headlines.

The highlights of this week’s market action are the following:

  • IWM,QQQ, and SPY put in new all-time highs yet again with QQQ momentum strongest
  • Growth Stocks continues to outperform value with Small Caps following
  • Volume patterns are positive led by the S&P 500
  • Semiconductors improved on a bullish phase change last week
  • Risk off sectors Consumer Staples and Utilities performed poorly
  • Risk Gauges are all positive for equities
  • Biotech roared, picking up as leading sector
  • Gold holding the 200-week RM (Real Motion) indicator and could have bottomed

Please check out this week’s videos for specific risk points

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