Stabilization in the Chinese markets and a very unclear outcome from the Democrat Iowa Caucus has the market in rebound mode this morning. As Mike Welch pointed out in the closing commentary yesterday, there was a hesitant rebound from Friday’s drop but the lack of any very negative Coronavirus news and an unknown leader among the Democrats overnight is helping to relieve some market fear. Despite the rebound yesterday, up volume on the NYSE was only 61.5% of total volume. Early in the day, it was over 80%. Let’s see if today can bring anything more convincing from the buyers.
I am looking forward to the State of The Union Address tonight. President Trump is sure to give some interesting body language to Nancy Pelosi sitting behind him, and the chaos in the Iowa Caucus couldn’t have given him a better script to challenge his opposition. In the meantime, we are waiting for the impeachment vote reinforcing there is no way to game the current political backdrop so we won’t try.
We are staying with what we know:
- Our tactical indicators continue to keep us from getting too positive.
- Our fundamental indicators continue to keep us from getting too negative.
- We look ready to buy any meaningful weakness that brings our tactical indicators to required levels.
Past performance is not a guarantee of future results. Index returns are unmanaged and do not reflect the deduction of any fees or expenses.
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