Market Direction Week of September 19, 2016

Market Direction: BULLISH alert issued 6/2/2016

Last Week Review: After a quiet few months, the markets have started to make some noise again. And while stocks were up on the week, the S&P 500 fell 2.5% on September 9, ending a 59-day streak in which the market had no daily moves of 1% or more. Since 1928, the stock market has logged 1% daily moves (up or down) about once every four trading days (25% of the time), making this stretch of low volatility one of the longest in history. Playing a bit of catch up, the market has moved greater than 1% in four of the last six trading days.¹ These swings have been prompted by speculation about if and when the Federal Reserve will hike rates this year. We believe this question and the backdrop of global uncertainty (Brexit, the presidential election, sluggish economic growth) is likely to spur more volatility.

How the market finished last week, the S&P 500 up 0.5%, the Nasdaq up 2.3%, and the Dow up 0.2%.

This Week: As you may have guessed the FOMC meeting will be the primary focus for traders and investors next week, but you may also want to keep an eye on the Bank of Japan meeting. Last time the BoJ kept interest rates unchanged and to be honest I’m not sure how markets will react to another round of inaction. Remember that the ECB didn’t push any additional stimulus last Thursday and that affected our interest rates – markets may scrutinize QE and its effectiveness, as well as what other tools central banks may use if inaction persists. Those two meetings aside, some emphasis may be placed on Tuesday’s housing data (last time Housing Starts increased 2.1% to the highest levels since February, but Building Permits dropped 0.1%).

Economic Calendar: Housing Market Index (9/19), FOMC Meeting (9/21), Leading Indicators (9/22), PMI Manufacturing Index Flash (9/23)

Some of the major earnings announcements on deck: LEN, FDX, BBBY, AZO.

 

$tockMarketDirection proprietary model is currently BULLISH. We strongly encourage you to monitor positions closely, exercise proper money management strategies and follow us at $tockMarketDirection for ALERTS we may issue advising a change in the current market direction. Stay tuned and follow us. If you have a testimonial or comment of how this website has helped you we would like to know, write us. Share with a friend. Cha-ching.

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