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With a large menu of economic statistics to be released next week, including ADP on Wednesday and the unemployment picture on April Fool's Day, the technical expectation is for choppy, volatile trading as prices consolidate their month long gains, with any surprises having an upside bias.
Well, it turned out to be another good week for the bulls as the major market indices closed up by an average of 2.27%, week over week, with the S&P 600 Small Cap Index (+3.27%) and NASDAQ Composite Index (+2.95%) having the largest gains as the expectation of easier monetary policy here in the United States found its reward with those issues that would be deemed as "less deserving". Taking it once around the horn and we see that the biggest winner this past week was again in the interest rate sensitive issues as the Investment Grade Corporate Bond advance/decline line is now literately going straight up as tremendous flows of capital are racing into this asset class. Also seeing new all time highs this week are our old friends the NYSE Bond CEF and NYSE Preferred advance/decline lines as money continues to seek out both safety and the best overall return on investment capital in a world of ever contracting yields. Even the NYSE REIT advance/decline line saw new all time highs this past week as well. And if that wasn't enough, the NYSE Composite advance/decline line continued to climb higher and wound up on Thursday some 183 net advancing issues from seeing new all time highs of its own, while the Ratio Adjusted NYSE Composite advance/decline line (not shown) actually finished the week 1 net advancing issue at new all time highs. Yep, it wasn't a bad week at all for the buyers as traders desperately try find products that will keep up with the daily cost of every day life....especially if you're at or close to retirement. In other areas, money flow in the Precious Metals and XAU advance/decline lines continues to meander sideways as traders remain short term indecisive on the precious metals next move, while overseas, India maintains its positive bias and the European bourses remain cautious after the bombings in Belgium. Although we now have a small pattern of tops beneath tops on the CAC advance/decline line to work with, another week of trading is needed to decide how important this might be moving forward. Because of this, let's take a neutral approach in these areas while we wait for more information. So with the BETS finally moving to its first accumulation signal since February 6th, 2015 with a reading of +25, the U.S. markets continue to surprise to the upside even after rallying for nearly 2 months without much in the way of taking a breather. With the important U.S. jobs data now out of the way, traders will now turn to the first barrage of 1st quarter earnings to be released this week where good numbers will be rewarded and bad numbers will likely be taken to the tool shed and be punished. As we have been discussing in the chat room, defensive, industrial and material sectors continue to shine, while consumer discretionary and technology issues have maintained buyer interest. Overall then, the markets remain quite buoyant, and until we see a prolonged stretch of negative plurality in the advance/decline data, the current path of least resistance will remain to the upside until proven otherwise. Have a great trading week! US Equity Markets : US Interest Rates : US Real Estate : Precious Metals: Australia: England: France: Germany: India: __________________ Dave's LinkedIn Profile Technical Watch Twitter Page Technical Watch Facebook Page "As for it being different this time, it is different every time. The question is in what way, and to what extent" - Tom McClellan "An economist is someone who sees something happen, and then wonders if it would work in theory" - Ronald Reagan "What we see depends mainly on what we look for" - John Lubbock "The eye sees only what the mind is ready to comprehend" - Henri Bergson “Answers are easy; it’s asking the right questions which is hard” - Dr. Who - 1977 "You know the very powerful and the very stupid have one thing in common - they don't alter their views to fit the facts, they alter the facts to fit their views (which can be uncomfortable if you happen to be one of the facts that needs altering)" - Dr. Who - 1977