two cents on stock model indicators


Nov 13, 2016

 


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#40610 Nov 13, 2016

Fellow Board Members,

Reading the indicators that I follow, most of which are connected to the model of Martin Zweig, I find that the trend indicators moved from neutral/negative to positive, the consumer credit indicator remained positive, the inflation indicator is positive (rather, not negative). The yield curve steepened, the bond interest and prime rate indicators are positive, and commodity prices increased. Until the Fed increases interest rates, the Zweig Model has to be very positive.

We also had a confirmation on a Bullish Dow Theory Indicator.

However,, one week does not make a market move. Further, the three-month treasury hit another new six-month high, consistent with an impending interest rate increase by the Fed. This in itself would reduce the bullish reading of the model, but the model would remain bullish if all other indicators remain the same..

Based on market history one might expect other factors to come into play. For example, the first year of a Presidential term is, on average, the worst of the four. That is not a certainty, however.

I had hoped to be selling stocks, but will just have to wait.

Good luck in the future,Tex



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