The stair step market continues for almost 2 years now. More stocks are becoming extended, and becoming difficult to chase that type of price action. But going against the bull unless in ultra short spurts is next to impossible. Bulls are still in control and have higher prices in mind, popular target range between 1900 to 1950 SPX.
Many farmers use the futures markets to hedge the price of their crops 6 months hence and the weather is usually the biggest factor in the risk equation. Last FALL was a neutral time for energy and a bear time for agricultural….but that’s changed in a big way.
Its been obvious for a while that the record bad weather this winter has given the energy sector a real push and I mentioned the possible crop apocalypse this summer…with food prices already rising on grocer’s shelves in milk, meat, cereals, honey, etc. How to play the game?
Another up day on very low volume. Like yesterday, XLF was the top dog in the VEGA model while XLU was well in the red. That’s bullish.
As a side note GE has been slowly building momentum after an extended period of stagnation while the SPY has risen…..an unusual situation given GE’s diversification across multiple sectors and the generally high ratings by analysts.
I have highlighted the study below a couple times in recent months, but the hot streak has remained so strong that I felt it deserved another mention. For many in the economy it may not feel as though employment news has been very good over the last 19 months. But the stock market would disagree. Read the rest of this entry »
Looking at the SPY daily VIXEN chart shows today’s chop and indecision. It even more evident looking at the action of the XIV on the SPY Trader chart
On the VEGA sector model XLE was the big loser and XLF was the winner.
Volume was luke warm at best confirming suspicions about short covering yesterday.
Note that QQQ and XLF were the Vega leaders…a reinforcement of my previous comment about XLF being a possible breakout candidate.