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US Taxes Returning to Economy-Killing Level

 
weekly Chart In Focus

The April 15 income tax filing deadline came this week, and so taxes are on the minds of a lot of Americans.  As Arthur Laffer noted 3 decades ago, it reaally is possible to set tax rates too high such that it actually hurts the economy.  We appear to be in such a condition now.

I wrote about this topic back in January, when lawmakers were contemplating raising the tax on gasoline.  But it is worth revisiting as we see total federal receipts creeping up toward 18% of GDP.  Whenever total... Read More

Crude Oil COT Report Data

 
weekly Chart In Focus

After a long price decline which started from a top back in June 2014, crude oil prices finally appear to be attempting to construct a bottom.  And perhaps equally important for that process, sentiment also seems to be developing in the right way to get a price bottom.

This week we are looking at data from the CFTC’s Commitment of Traders (COT) Report, something that I feature every week in our Daily Edition.  The chart above depicts the net position of the commercial traders of NYMEX crude... Read More

No Bear Market Signal Yet From Housing

 
weekly Chart In Focus

Before each of the really ugly bear markets of the past 30 years, there has been an important signal from housing data well ahead of time.  We do not have such a signal now, and so that portends more upside in the months ahead for stock prices. 

In fact, the past 3 months have seen a pretty substantial upsurge, especially in the Northeast and South regions of the USA as tracked by the Census Department.  That takes the seasonally adjusted annual rate of new home sales to its highest level... Read More

Global Temps Call for 2015 Yield Bottom

 
weekly Chart In Focus

While the debate rages over global warming, I find that the data on global average temperatures can be put to another use: forecasting interest rates.  And the big message for us right now is that yields are due to hit a bottom this year, and head upward into 2017.

In the chart above, I am showing the average yield on Moody’s AAA rated corporate bonds.  That’s the green line.  The red line is an inverted plot of the HadCRUT4 global temperature series, developed and maintained by the Hadley... Read More

The Real Relationship Between Dollar and Stock Market

 
weekly Chart In Focus

If you think that you know the one true relationship between the stock market and the value of the dollar, you are wrong.  Or perhaps I should say more charitably that you are going to find yourself wrong about half of the time.

The truth is that the US Dollar Index (DXY) and the SP500 show a positive correlation sometimes, and then at other times it flips to an inverse correlation.  And this has been going on for years.  I have tried mightily to find the causative agent which makes the... Read More

2-Year T-Note Shows Path For FOMC

 
weekly Chart In Focus

I wrote back in 2011 that the Fed could do a lot better with interest rate policy if the FOMC would just outsource the decision making task to the bond market, specifically the 2-year T-Note yield.  The point is still the same, and the FOMC is still seemingly unaware.

To review briefly, this week’s chart shows a comparison between the 2-year Treasury Note yield and the target rate for Fed Funds, which is set by the FOMC.  The NY Fed is then tasked with adding or withdrawing money available... Read More

 
Daily Timing Chart

 

04/17/2015 IssuesVolume(000s)
McC OSC -64.870 -23034
Sum Index 2693.878 1482069

More Data

The McClellan Oscillator

 

OscillatorCreated 1969, the McClellan Oscillator is recognized by technical analysts as the essential tool for measuring acceleration in the stock market. Using advance-decline statistics, it gives overbought and oversold indications, divergences, and measurements of the power of a move.