“YoY growth of US imports from China is contracting at the fastest rate since the 2008-2009 recession, which was the deepest contraction for growth of US imports from China in 23 years of trade data to that point.
Moreover, China’s import prices are now exhibiting a coincident recession-like decline in US imports from China as similarly occurred in 2008-2009, which in turn is indicative of recession-like conditions for US exports.”- Bruce Carman, posted at dShort Advisor Perspectives. Full story at…
http://advisorperspectives.com/dshort/guest/Bruce-Carman-130703-Global-Trade.php
CHINA RISK (ZeroHedge)
“If, however, they [China] continue on the current path
and allow this deterioration to reach its natural and logical limit, we will
likely see a full-scale recession as well as a collapse in asset and real
estate prices sometime next year…The combination of rich valuations and further threats to
growth has led us to dramatically reduce risk in the portfolio and actively
position ourselves to withstand the uncertainty and instability
ahead" – Kyle Bass from the Hayman Capital investor letter. Story at ZeroHedge at…http://www.zerohedge.com/news/2013-07-04/kyle-bass-hunkers-down-we-dramatically-reduce-portfolio-risk
MORE ON EMPLOYMENT: 326,000 FULL-TIME JOBS LOST
(Shedlock)
The establishment survey showed a gain of 195,000 and
that is a very respectable number. However, the household survey shows a more
modest gain of 160,000 jobs…Digging beneath the surface, the numbers do not
look so good…Involuntary part-time jobs increased by 322,000 while voluntary part-time jobs increased by another 110,000. Thus, of the 160,000 household survey gain, 486,000 of them were part-time jobs, a loss of 326,000 full-time jobs.” Mish Shedlock at Global Economic Advisors. Full story at… http://globaleconomicanalysis.blogspot.com/2013/07/establishment-survey-jobs-195k.html
YIELDS ON TREASURIES AND MORTGAGE BACKED SECURITIES SURGE
“Curve Watchers Anonymous notes that treasury yields
surged higher and mortgage backed securities (MBS) had a steep selloff
following purportedly good job numbers.” – Global Economic AdvisorsCommentary at http://globaleconomicanalysis.blogspot.com/2013/07/mbs-clobbered-and-treasury-yields-soar.html#UdgiWSM5ycBfdbh5.99
The above is more evidence of “Tapering-fear”; stocks don’t seem to care.
MARKET REPORT
Monday, the S&P 500 was up 0.5% to 1640 (rounded).
VIX was down about 0.7% to 14.78.Monday, the S&P 500 was up 0.5% to 1640 (rounded).
Today, the S&P 500 settled on its upper
trend line. I’ve probably said that
before, but the trend line is hard to define sometimes. Today it looks clear, based on my assumption
that the distance between trend lines should be about 5%. So for me, we still haven’t broken out of the
down trend yet. Even so, the signs look
good for further gains and an end to the correction.
The S&P 500 is above its 50-day moving
average by 0.8% and market internals are positive. 10-d MA of Breadth is up to 57%; the 20-d MA
is 49% stubbornly resisting the positive signal by the 10-day moving average. New highs
new lows are positive with new-highs outpacing new-lows by 231.
NTSM
Monday, the overall NTSM analysis is HOLD at
the close.
There was no technical reason for the
reversal of the stock market 2-weeks ago on 24 June. The market just bounced up from its lower
trend line and is up 4% since then.
Correction over? A day or two and
we’ll know.
MY INVESTED POSITION
I remain about 20% invested in stocks as of 5 March (S&P 500
-1540). The NTSM system sold at
1575 on 16 April. (This is just another
reminder that I should follow the NTSM analysis and not act emotionally – I am
under-performing my own system by about 2%!)
I have no problems leaving 20% or 30% invested. If the market is cut in half (worst case) I’d
only lose 10%-15% of my investments. It
also hedges the bet if I am wrong since I will have some invested if the market
goes up. No system is perfect.
