Trend Report May 2017

| May 24, 2017
Share |

The Good…

  • Growth has picked up in the US suggesting a possible positive tail-wind for the US stock market.
  • The Dow Jones Industrial and Global Dow Jones indices are in positive trends and remain on buy signals.
  • Short-term measures of market internal strength are suggestive of a continued rally.
  • The top ranked asset classes on a relative strength basis are those most sensitive to economic growth.

The Bad…

  • Commodity prices are the weakest asset class, suggesting that reflation may have peaked.
  • The Dow Transports is currently on a sell signal and is showing a negative divergence.
  • Long-term measures of market internal strength suggest a cautious positioning.
  • Continued Federal Reserve tightening could accelerate the flattening of the yield curve, indicative of a late cycle environment.

The Ugly…

  • The Market is now in one of the most overvalued, euphoric markets, ever witnessed.

What Should We Do?...

  • Follow the trend and stay with the momentum of the market.
  • Allocate assets wisely and use diversifying strategies.
  • Keep some cash.

Enjoy it while it lasts.

Trend Report May 2017

Share |