View From The Hill: December-1-2015

Posted on Posted in Views From The Hill

Stock and Bond Bulls Telling Yellen To “Bring It”

bulls-and-bears4

In spite of the weak ISM Manufacturing November-2015 (actual @ 48.6 vs. consensus @ 50.5 and prior @ 50.1), the market responded with a robust rally. Regarding December’s impending rate hike, it’s almost as if stock market bulls are telling Fed Chairperson Yellen to “bring it”. However, CNBC’s David Faber made a most salient point earlier today in that the last time the Fed raised interest rates with the ISM below 50 was in August-1985. Anecdotal or fundamental? You be the judge.

Not all the economic data was bad. The PMI Manufacturing Index for November-2015 was solid @ 52.8 vs. consensus @ 52.6 and prior @ 54.1. Construction Spending in October-2015 increased 1.0% mth/mth vs. consensus @ 0.6% and prior @ 0.6%, while annual growth was @ 13.0% vs. prior @ 14.1%.

Tonight’s comments will be brief, but it would be remiss of me not to mention the sharp drop in Treasury rates which gave bonds a much needed boost. Perhaps the bond market is telling Yellen to “bring it” as well.

(Please see performance summary below for further reference on asset classes).

 


Performance Summary

  • Trends: ST = short-term; MT = Intermediate-term; LT = long-term
vfth-performance-12-1-2015
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Market Condition

Today the SP-500 broke out to a new 17-day high after seven days of consolidation, which establishes a higher base of price support for the benchmark index. It also closed above its 22-day moving average and it’s next challenge will be to break the resistance of the previous lower uptrend channel, which it failed in its last attempt during early November-2015. Momentum is just beginning to accelerate and the percentage of SP-500 components trading above their 200-day average has crossed into bullish momentum territory. Things should start to get interesting at this point. (If the market fails to break resistance a second time, there is a risk of a more severe correction than the previous one in November.)

Stay Hillbent for the Market Direction…

 

Daily Chart Technical Analysis
sp500-daily-12-1-2015
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Market Breadth
Advancers 421 Decliners 78
New 5-day highs 205 New 5-day lows 66
New 52-week highs 30 New 52-week lows 11
Bullish reversals 105 Bearish reversals 29

 

Market Momentum
% > 20 M.A. % > 50 M.A. % > 100 M.A. % > 200 M.A.
72%
75% ↑
56% ↑
53% ↑
↑ = positive momentum; ↓ = negative momentum; and ↔ = neutral momentum

 


Volume Radar Alerts

  • Vol % = volume percentage greater than average volume
  • SIR = short interest ratio or days to cover
vfth-volume-radar2-12-1-2015
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Disclaimer

Hillbent does not provide individualized market advice. The information we publish regards securities in which we believe our readers may be interested and our reports reflect our sincere opinions. Nevertheless, they are not intended to be personalized recommendations to buy, hold, or sell securities. Investments in the securities markets, and especially in options, are speculative and involve substantial risk. Each individual investor should determine their respective appropriate level of risk. It is recommended that you seek personal advice from your professional investment advisor and conduct further independent due diligence research before acting on information published in any of our reports. Most of our information is derived directly from information published by the companies on which we report and/or from other sources we deem to be reliable, without our independent verification. Therefore, we cannot assure the completeness or accuracy of information contained within these reports and we do not in any way warrant or guarantee the success of any action which you take in reliance on our statements. Hillbent.com, Inc. or its affiliates may own positions in the equities mentioned in our reports. We do not receive any compensation from any of the companies covered in our reports.

 

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