Weekly Market Summary

I’m changing my summaries to weekly. It’s a bit less noisy than the daily indicator summary. And a weekly summary allows for a slightly different view and a better investment plan.

Short-term: Slightly negative
Intermediate-term: Neutral

Last week’s pullback turned out to be, generally, more healthy than indicative of something worse. That said, roughly 2/3 of equities still look like this is a false rally overall for them. Like last year, it looks like we are in summer noise mode and have established a trading range for the Memorial Day to Labor Day timeframe.

Strongest currencies last week were the two safe-havens – yen and swissie. US$ isn’t a safe-haven until debt ceiling argument is resolved. Weakest currencies last week were euro, A$, and emerging currencies. The swissie is the only currency that is a bit overbought over the last month. It could be vulnerable to either a “risk on” move or a short-term resolution of the US$ “safe havenness”. No currencies are oversold. Longer-term, the barbell currency trade (A$ and swissie) that has performed well over the last year looks overbought – while the US$ looks oversold. Overall, currencies are not indicating a direction for other markets.

The healthiest looking equity markets look to be (in no order): Canada, Japan, HK, Singapore, Taiwan, Malaysia, and Mexico


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