Last Oct I published a series of charts named “The preponderance of evidence”, I think it is time for a new series. I think the charts itself should be self explanatory. Feel free to drop me a line on what you think.
i see breakout and retest- soon to explode higher. what do you see?
WellTrainedMonkey
⋅
@chocotraders, thanks for your comments. I think your view is definitely within the realm of possibility especially if the $86.40 SSR and MA support holds. Personally speaking, I see a negative divergence between the price action and the stochastics, a lack of follow-thru after the initial break resulting in an immaterial new high which suggest to me this is a head-fake. I am also thinking a rate cut does very little for heavily indebted companies facing a demand short-fall as is evidenced by the declining manufacturing PMI and durable goods new orders.
@chocotraders, the demand shortfall I was referring to is in reference to demand for companies' products and services. To clarify, I do not think a rate cut will help with end demand for companies products and services. As such, the associated debt servicing ability of these high yield companies will increasingly come under pressure.