POSITION: Long Consumer Discretionary (XLY)
If you need proof that US Employment and US Consumption enjoy a Strong Dollar, ask an American.
If you need proof that the US stock market is making lower-highs, just pull up a chart. The SP500 is making lower-highs on 2 of 3 risk management durations (TAIL and TRADE).
The question from this time and price is whether we break-out back above TRADE resistance (1231) or break-down below TREND (1207) support?
Across all 3 risk management durations (TRADE, TREND, and TAIL) here are the lines that matter most:
- TAIL resistance = 1269
- TRADE resistance = 1231
- TREND support = 1207
On any rally toward 1231 that fails, I’ll be considering re-shorting the SPY because being long Consumption here can only take this market to another lower-high as long as the Financials and Basic Materials/Energy stocks continue lower.
Keith R. McCullough
Chief Executive Officer