The following is the opening segment of this week’s edition of Notes From the Rabbit Hole, NFTRH 437. While I think several proposed Trump administration policies would have positive down the road effects for corporate America and the asset ownership class, the administration will have to survive intact in order to implement them. This is one erratic and shall we say, fluid, situation and this is not a leader who inspires confidence, speaking personally at least.
Last week we reduced the charting in favor of increased talking. That was because I had some things to say about the at-risk gold sector and its incomplete macro fundamentals.
There was also a lot to say about stock market sectors that would be favored or avoided if the long-term bond yield environment continued to shift to declining (bonds bouncing). Last week dealt a blow (in the form of Trump’s triumphant speech to congress and unusually aggressive Fed jawboning) to bonds, but did not break the play.
In this new world of technology and its attendant problems of the hacking of gadgets and products, Apple’s iWatch now takes on a whole new meaning after WikiLeaks published material yesterday that is purported to be CIA documents and files related to U.S. intelligence cyber and spying activities.
Apple (AAPL) is nearing a convergence of a couple of Fibonacci levels that may serve as resistance around 145.00-146.00, as shown on the following Weekly chart.
On Monday morning I gave a twenty handle inflection range on SPX, bracketed by important gaps above and below at the possible breakaway gap above from Friday’s close at 2383.12, and the open gap below from 2263.64. Since then SPX has resolutely stayed within that range, and is almost in the middle of the range at the time of writing. So far, so boring, but time is no friend to the bulls here. If we don’t see a break up towards ATH retests today or possibly tomorrow, then the window of opportunity to see those retests may well be over.
I won’t show the futures charts today but on all of ES, NQ & TF yesterday morning’s falling wedges that had broken up evolved into larger falling wedges, that have now all also broken up. Key resistance is still at the weekly pivots on ES (2379.75) and NQ (5363.25), and conversion of these levels to support opens the ATH retests there. We’ll see, NQ is currently above the weekly pivot there though that’s not the first attempt to convert it.