Monday Morning Chartology-8/16/10
Steve Cook on Disciplined Investing

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Tomorrow morning I leave for retreat at which I will be completely out of touch.  Next communication will be next Monday.

The Market
    
    Technical

      Monday Morning Chartology

    Unfortunately, the S&P charts looks like the index is forming the right shoulder of a head and shoulders--which is not positive for stocks.  Since I will be out of touch, what I would be looking for before doing any buying would be a bounce but from a lower level (at least in the lower quadrant of the current trading range 1009-1149) then a break through the down trend line off the recent high.



 

    It appears that gold has re-set itself back to an up trend.



 

    The VIX has regained the short term support level but remains in an intermediate term down trend.



   

   Fundamental
  
      
    Best investments in deflation (medium)
    http://www.marketfolly.com/2010/08/best-investments-during-deflation.html

    Best investments in inflation (medium):
    http://www.marketfolly.com/2010/08/best-investments-during-inflation.html

    Earnings yield versus bond yields (chart):
    http://scottgrannis.blogspot.com/2010/08/earnings-yields-tower-over-bond-yields.html

Economics

   This Week’s Data

    The New York Fed reported its August manufacturing index at 7.1 up from June’s 5.1 but below expectations of 8.0.
    http://www.calculatedriskblog.com/2010/08/ny-fed-manufacturing-conditions-improve.html

   Other

    Everyone’s scaling back their 2010 forecast for growth (medium):
    http://www.bloomberg.com/news/2010-08-11/economists-cut-u-s-growth-forecasts-as-companies-limit-hiring.html

    Container shipping volumes remain robust (chart):
    http://mjperry.blogspot.com/2010/08/doom-and-gloom-hasnt-hit-containers.html

    Some reflections on M2 (short):
    http://scottgrannis.blogspot.com/2010/08/no-shortage-of-liquidity-rather-excess.html

    Rick Santelli on Fed ‘tinkering’ (7 minute video):
    http://www.zerohedge.com/article/rick-santelli-goes-nuts-top-3-rant-protesting-what-else-endless-subsidies-and-fed-meddling

Politics

  Domestic

A not very positive essay on Keynesian economics (a bit long but today’s must read):
http://www.zerohedge.com/article/eric-sprott-we-are-now-paying-funeral-keynesian-theory











Posted 08-16-2010 8:33 AM by Steve Cook