Hello Everyone
Today, Jan-19, and post-MLK holiday, I was entertained on my drive to work listening to the various business news stations, which celebrated the “triple digit open” (on the Dow Jones) and the fact that the markets “came back from the holiday, refreshed and ready to rally.” I say entertained because such talk is indeed entertainment, as the “big open” subsequently went into a decline for most of the remainder of the day, which is reflective of selling/distribution.
It is important to note that the previously discussed support level of 1865 on the SP 500 was breached on Jan-15, when the SP 500 hit 1857.83. It then recovered slightly but this new 52-week low is lower than any point since October 2014. See chart:
I am disappointed that the market’s behavior during the day, carried over into the nighttime futures session, with the Dow Jones Futures trading 200 points to the negative as of 10:05 PM CDT on Jan-19. See graphic:
Why is this happening ? Again, my crystal ball tends to be unreliable, but most believe that China, Crude Oil, and potential interest rate hikes in 2016 are choking the market. Note that I discussed my own personal concerns with China and Crude Oil almost one year ago, on this site. Other business sites, cable news, etc are just now waking up to those issues.
As can be seen below, Crude Oil is trading at new lows, of $28.79 (a new record low):
The market remains a risky minefield, and I remain 100% G-Fund.
Thank you and talk to you soon…
-Bill Pritchard
