The Fred Report - Weekly August 22, 2011
For Investors: deploy some cash into favorable sectors (Large Cap Energy still looks appealing), realizing that this is very likely not the final low in the market. Should stocks rally, Treasury Bonds should sell off – and sharply. We note that in spite of the recent market turmoil, commodities continue to outperform, and we expect this to continue into the end of the year.
The Fred Report - Mid Week Update August 17, 2011
We have a short-term buy signal that should be good enough to take us up through the 120 area to the 123 area we have suggested should occur. We have no changes in opinion on other markets – Bonds should be lower at the end of the week, gold higher – but risk of a sharp drop remains for both. The Accumulation Models on both XLI and XLB have improved from the horrid levels of two months ago – but still look dicey.
The Fred Report - Weekly August 15, 2011
Last week, our forecast became a rally towards the 1200 – 1235 area on the SPX, and we still see this as the likely outcome for this week. Thus far, bonds have outperformed my expectations but this may end abruptly as indicators do not support TLT at these levels. We have recommended investing in Singapore and Malaysia as these have been strong technical charts.
The Fred Report - Mid Week Update August 10, 2011
Obviously this has been a difficult market but it looks as if there is some light at the end of the tunnel. Our forecast for the next several days is a rally to the 1200 to 1235 area on SPX followed by some backing and filling, and then another move down within 5 -7 weeks to retest and slightly exceed the low we have made on a closing basis. Readers may want to take some of the GLD profits and put it into the PSAU – this mining and precious metals ETF is outperforming stocks so far, and should outperform into the end of the year.
The Fred Report - Weekly August 8, 2011
We would expect a rally after a down open on Monday. We think the SPY can test the 122 – 125 area or possibly higher over the next few days/week. We have lightened up in Gold and moved our opinion to an underweight despite it moving above $1700. We continue to like commodities and think they will outperform into the end of the year.
Tuesday’s action has broken major support on most indexes, and caused a good bit of consternation amongst our clients and in the technical community as a whole. We reiterate that gold and the commodities area is still our favorite investment overall. While TLT could move higher, we see risk of a sharp reversal. We would begin the process of lightening up, and raise stops on the rest of positions.
The Fred Report - Weekly August 1, 2011
We believe in the adage “be quick to turn bullish and slow to turn bearish”, and certainly we could see some real improvement here – but caution is indicated unless we move quickly above the 135 area on SPY. Unless we exceed recent highs on broader indexes such as the NYA (NYSE Composite), the possibility for further corrective action remains. Commodities remain our favorite asset class, and we note that gold has made all time highs. A move above the 77 area on DXY would break the trading range to the upside.
The Fred Report - Mid Week Update July 27, 2011
This weakness early in the week may turn out ok, as long as the market turns up and has a strong close to the week. We do not want to come across as unduly bearish, and this could simply be a “pause that refreshes.” The dollar still has a chance to advance, but needs to hold the 73.20 area.
The Fred Report - Weekly July 25, 2011
Exceeding the Cambridge Hook high of 137.18 should set the market up to attempt a move above the 140 - area resistance by the end of summer, in line with our forecast. While our forecast has been for a stronger 2nd half to 2011, we are beginning to see more signs that this may not be in the cards. We remain concerned that rates around the world could start to rise in the second half of 2011.
The Fred Report - Mid Week Update July 20, 2011
It looks to us as if this rally can take us to new rally highs on the SPX. We believe that the recent lows (OEF 58.05 and SPY 129.63) should be the summer lows – and these should not be retested before upside objectives are met.
The Fred Report - Weekly July 18, 2011
We believe that a rally into the end of August could be starting this week. Our upside objective for this summer rally continues to be the 140 area. The salient point to remember, though, is that bonds themselves, at least so far, do not seem to be concerned by the prospects of default on either a national or local level. The FXE is testing key support in the 139 – 140 area and we ultimately think it is going to break.
The Fred Report - Mid Week Update July 13, 2011
We would like to see another down move to test the 130.50 area intraday, but frankly we believe that may not occur and we could simply rally from this general area. Oddly enough, due to recent strength in the FXY, the dollar has been flat even as the FXE has come down.
The Fred Report - Weekly July 11, 2011
Indicators suggest a bit more retracement is possible, and some choppiness, as well – it is expiration this week. We would use declines to the 133 to 132 area to add to positions for a summer rally that should ultimately carry to the 140 – 144 area on SPY. LQD remains more attractive for bond investors on a technical basis.
The Fred Report - Mid Week Update July 7, 2011
We still think a sharp test down is in the cards, which may not last very long, and recent action, particularly in IYT, would tend to confirm this. It looks like 126 is the maximum downside for the SPY until we get a new selling indication, and in fact the downside may only be 130.
The Fred Report - Weekly July 5, 2011
We sense some skepticism with regard to the recent strength, and we think the market can exceed the old 137 area high and test 142, 143 by the end of summer. While bonds could certainly bounce this week, the big potential for more upside in this market has likely exhausted itself. Agricultural commodities have a tendency to rally in the summer.
The Fred Report - Mid Week Update June 29, 2011
While the price action is good, accumulation models are less so, and some backing and filling, or an outright decline, is still possible and would not be a surprise. The TLT has closed below 95 and unless we move back above there soon, the up-move in TLT (and bonds) is likely over and it should move back to 88 or lower.
The Fred Report - Weekly June 27, 201
The IWM and IYT are trading stronger than the SPY, and accumulation models on all stock indexes have improved markedly last week. We would be VERY careful in this environment as bonds could start to do very badly. We are running out of time to test the 100 area on TLT before the next decline starts. Aggressive advisors looking to add a bit more money this week should carefully consider oil stocks, or the XLE and/or OIH. The UUP remains our favorite speculation, and we reiterate that should FXE decline through 140 the dollar should get a nice pop.
The Fred Report - Mid Week Update June 22, 2011
What would be ideal would be some further rally/consolidation to keep the SPY up in this area (we do not think it can go higher than132 – 133), then a sell-off into the end of the month of June. HYG especially looks interesting and traders can start to accumulate as this will likely trade in line with stocks.
The Fred Report - Weekly June 20, 201
We would like to see a slight up week, followed by a drop into the end of the month to reset our monthly indicators. Bonds could stat another up-leg here, and the TLT could challenge the 100 area. The metals look more attractive than oil at this point in time – gold in particular, but silver could rally as well. Should FXE move down through the 140 area that should be enough to move the dollar above 77 which would be a significant breakout.
The Fred Report - Mid Week Update June 15, 2011
The short-term oversold condition was somewhat ameliorated by Tuesday’s action but there is room for more upside before the short-term moves to neutral. This may be more a correction in time rather than price – i.e. the market may not go much lower here, but rather consolidate, with several false starts to wear us out before the next up leg starts. Much lower than 95 on the TLT would be yet another sign that this move is ending and rates are going higher. Should the UUP move above 21.45 this move would look stronger and this is what we expect.
